Antero Midstream Partners LP AM is expected to report first-quarter 2015 earnings on Wednesday, Apr 29. Let’s see how things are shaping up prior to the announcement.
Factors to Consider This Quarter
Antero Resources is engaged in the acquisition, development and production of unconventional liquids-rich natural gas properties located in the Appalachian Basin in West Virginia, Ohio and Pennsylvania. However, recent start-ups would be affected in the near to medium term owing to the negative effects of commodity price declines.
Given the tepid commodity outlook, the partnership allotted growth capital expenditure for 2015 in the limited range of $415–435 million and maintenance capital expenditure at only $10–15 million. This is due to the fact that management expects to defer the completion of 50 wells into 2016.
The partnership was formed only in Sep 2013 by Antero Resources Corporation AR to own, operate and develop gathering systems and midstream infrastructure to support production in the Appalachian Basin.
Earnings Whispers
Our proven model does not conclusively show that Antero Midstream is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here, as you will see below.
Zacks ESP: Earnings ESP for Range Resources is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 12 cents.
Zacks Rank: Antero Midstream carries a Zacks Rank #3 (Hold). We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies that have the right combination of elements to post an earnings beat this quarter:
Marathon Petroleum Corp. MPC has an Earnings ESP of +2.13% and a Zacks Rank #1 (Strong Buy). The company is slated to release earnings on Apr 30.
Suncor Energy Inc. SU has an Earnings ESP of +400.00% and a Zacks Rank #2 (Buy). The company is slated to release earnings on Apr 29.
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