Questar Earnings Preview

Before you go, we thought you'd like these...
Before you go close icon

Investors hope Questar (NYS: STR) will top analyst estimates once again after beating predictions by $0.03 in the previous quarter. The company will unveil its latest earnings on Tuesday, Feb. 14. Questar is a natural gas-focused energy company with five major lines of business: gas and oil exploration and production; midstream field services; energy marketing; interstate gas transportation; and retail gas distribution.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Questar, with six out of eight analysts rating it a hold. Analysts don't like Questar as much as competitor Double Eagle Petroleum overall. Two out of three analysts rate Double Eagle Petroleum a buy compared to one out of eight for Questar. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $356.8 million in revenue this quarter. That would represent a decline of 1.6% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.34 per share. Estimates range from $0.31 to $0.36.

What our community says:
CAPS All-Stars are solidly backing the stock, with 93.5% awarding it an outperform rating. The community at large is in line with the All-Stars, with 94.5% assigning it a rating of outperform. Fools have embraced Questar, though the message boards have been quiet lately, with only 83 posts in the past 30 days. Even with a robust four out of five stars, Questar's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Questar's income has fallen year over year by an average of 34.8% over the past five quarters. The company's revenue has now risen for two straight quarters. The company's gross margin shrank by 3.3 percentage points in the last quarter. Revenue rose 1% while cost of sales rose 9% to $65.4 million from a year earlier.

Now, a look at how efficient management has been at running the business. Margins illustrate how efficiently a company captures portions of sales dollars. Questar's gross margins, which reflect the total sales revenue retained after costs, have been dropping year over year for the last four quarters. Here is how Questar has been doing for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

55.4%

68.1%

44.4%

40.9%

Net Margin

24.6%

18.1%

14.9%

17.6%

For all our Questar-specific analysis, including earnings and beyond, add Questar to My Watchlist.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Earnings estimates provided by Zacks.

At the time this article was published

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners