Energy Prospectus

This morning I went through all of Dan's updated forecast models, noting companies where Dan's estimates beat consensus earnings in both Q4 2018 and FY 2019. My objective was to find companies that could beat Q4 earnings AND guide higher in 2019. My thinking, if you can find companies that beat earnings and raise FY estimates (with maybe an analyst upgrade or two), we might get a big jump in stock price... Which is well-suited for options...

I thought some of you might appreciate having this info (quoted as of this morning):

Stock, Dan Q4, Consensus Q4, % diff, Dan 2019 FY, Consensus 2019 FY % diff
xec, $2.01, $1.88, 6.91%, $8.97, $6.55, 36.95%,
gpor, $0.60, $0.50, 20.00%, $1.75, $1.32, 32.58%
pdce, $0.51, $0.60, -15.00%, $3.40, $2.58, 31.78%
swn, $0.43, $0.28, 53.57%, $1.05, $0.83, 26.51%
lpi, $0.54, $0.24, 125.00%, $0.84, $0.57, 47.37%
crk, $0.40, $0.34, 17.65%, $0.85, $0.76, 11.84%
mmp, $1.24, $1.18, 5.08%, $4.69, $4.38, 7.08%
enlc, $0.92, $0.69, 33.33%, $1.03, $0.35, 194.29%


Certainly LPI, SWN, and ENLC all stood out as companies with the most upside. And the options prices are very reasonable...

Interested in your assessments....

Dave

Good work Dave! Keep it up.

First let me remind all of you that "Reported Earnings" and "Adjusted Earnings" can and will be vastly different during quarters where there have been big changed in the commodity prices. "Adjusted Earnings" are what you should compare to my EPS estimates and the same for First Call. Reported or GAAP earnings include non-cash mark-to-market adjustments on hedges. LPI's reported earnings for Q4 will include a $0.35/share net gain on their hedges.

I am expecting LPI's Adjusted EPS to be around $0.20/share.

First Call's EPS estimates are an average of all the analysts' reports submitted to Reuters. Some of the reports are quite old and they are based on "outdated" oil & gas price decks. Also, keep in mind that the small-caps have a lot fewer analysts covering them. Even a large-cap like CLR, which I looked at today, has some very old reports included in the First Call numbers.