EOG Resources Expected To Report Huge EPS Decline

Shares of EOG Resources Inc EOG are surging on Monday morning as the E&P company prepares to report its first quarter financial results after the market close.

According to Estimize, the crowd’s and experts’ expectations are pretty much in line: while Main Street projects EPS of $0.03 on revenue of $2.66 billion, Wall Street models EPS of $0.00 on revenue of $2.563 billion.

This implies a large fall from the $1.40 EPS reported in the first quarter of last year, and the $0.79 EPS registered in the last reported quarter.

The graph below displays EOG’s history of actual earnings versus estimates. As it can be seen, the company usually beats consensus expectations – except for last quarter, when they missed Wall Street’s consensus by $0.20.

It is also possible to see how the sentiment has evolved over time.

As evidenced by the chart above, sentiment in the Street has become increasingly bearish regarding EOG.

E&P And Oil Prices

In a recent research note, analysts at Nomura recommended North American E&P stocks, including EOG (Buy rated, $112 price target). According to a Benzinga article, “analysts believe that oil prices, which are down nearly 50 percent in the past year, drive the performance of many E&P stocks, and they believe that a recovery in oil prices is coming in the near future.”

On the other hand, Wunderlich named EOG as one of the least hedged E&Ps if low oil and gas prices persist beyond this year.