WPX Energy, Inc. (WPX) will release its third-quarter 2014 financial results on Nov 5, 2014. In the prior quarter, the oil and gas company reported a positive earnings surprise of 160.00%. Let’s see how things are turning out for the third quarter.
Why a Likely Positive Surprise?
Our proven model shows that WPX Energy is likely to beat earnings because it has the right combination of the key factors.
Positive Zacks ESP: The Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +100.00%. This is a meaningful and leading indicator of a likely positive earnings surprise for a company.
Zacks Rank #3 (Hold): WPX Energy is a Zacks Rank #3 stock. Stocks with Zacks Ranks #1, 2 and 3 have a significantly higher chance of beating earnings. Conversely, Sell-rated stocks (#4 and 5) should never be considered going into an earnings announcement.
The combination of WPX Energy’s Zacks Rank #3 and +100.00% ESP makes us confident of an earnings beat on Nov 5.
What is Driving Better-than-Expected Earnings?
Tulsa, OK-based WPX Energy is systematically expanding its domestic presence, primarily in the Williston and Piceance basins. The company is currently active in the San Juan Basin. Positive outcomes from these properties will enable WPX Energy to increase its production volume besides expanding reserves, which will subsequently boost its third-quarter earnings.
In addition, WPX Energy follows a strategic asset divestment program. These initiatives will bring in proceeds, which the company will be able to utilize in profitable ventures.
Other Stocks to Consider
Here are some other stocks in the same sector that you may want to consider as our model shows that these also have the right combination of elements to post earnings beats this season:
Cobalt International Energy, Inc. (CIE) has an earnings ESP of +11.11% and a Zacks Rank #1 (Strong Buy).
Crescent Point Energy Corp. (CPG) has an earnings ESP of +20.93% and a Zacks Rank #3.
EOG Resources, Inc. (EOG) has an earnings ESP of +0.78% and a Zacks Rank #3.
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