Southern Union Earnings Preview

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Investors never know what to expect for Southern Union (NYS: SUG) , as it has wavered between topping and missing analysts estimates during the past fiscal year. The company will unveil its latest earnings on Monday, Feb. 20. Southern Union is engaged in the gathering, processing, transportation, storage, and distribution of natural gas in the United States.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Southern Union, with two out of three analysts rating it hold. While analysts still rate the stock a moderate sell, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $523 million in revenue this quarter. That would represent a decline of 22% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.56 per share. Estimates range from $0.53 to $0.59.

What our community says:
CAPS All-Stars are strongly supporting the stock, with 93.9% giving it an outperform rating. The greater community agrees with the All-Stars, as 91.8% give it a rating of outperform. Fools are impressed with Southern Union, though the message boards have been quiet lately, with only 50 posts in the past 30 days. Even with a robust four out of five stars, Southern Union's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Southern Union's profit has risen year-over-year by an average of 12% over the past five quarters. The company's revenue has now risen for two straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross and net margins over the past four quarters.

Quarter

Q3

Q2

Q1

Q4

Gross Margin

30.3%

30.4%

26.8%

30.7%

Net Margin

9.4%

9.5%

8.1%

8.3%

One final thing: If you want to keep tabs on Southern Union's movements, and for more analysis on the company, make sure you add it to your Watchlist.

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Earnings estimates provided by Zacks.

At the time this article was published

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