Plains Exploration & Production Earnings Preview

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Plains Exploration & Production (NYS: PXP) will try to beat its earnings estimates for the third consecutive quarter. The company will unveil its latest earnings on Thursday, Feb.23. Plains Exploration & Production is an independent oil and gas company that is engaged in acquiring, developing, exploiting, exploring, and producing oil and gas properties in the United States.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Plains Exploration & Production, with 12 out of 14 rating it a buy and the remainder rating it a hold. Analysts don't like Plains Exploration & Production as much as competitor Berry Petroleum overall. Analysts still rate the stock a moderate buy, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $495.6 million in revenue this quarter. That would represent a rise of 21.4% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.43 per share. Estimates range from $0.16 to $0.55.

What our community says:
CAPS All-Stars are solidly backing the stock, with 96.4% giving it an outperform rating. Most of the community concurs with the All-Stars, with 96.4% granting it a rating of outperform. Even with a robust four out of five stars, Plains Exploration & Production's CAPS rating falls a little short of the community's upbeat outlook.

Management:
The company increased its gross margin by 6.4 percentage points in the last quarter. Revenue rose 29.4% while cost of sales rose 2.6% to $122.4 million from a year earlier.

Now let's get some insight into how efficient management is at running the business. Margins illustrate how efficiently a company captures portions of sales dollars. The company's operating margins have been increasing year over year for the last three quarters. Operating margins reflect the total sales revenue that the company retains after costs. Here are Plains Exploration & Production's reported margins for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

75.6%

72.2%

71.6%

70.2%

Operating Margin

33.6%

36.2%

31.1%

22.7%

Net Margin

(17.6%)

24.3%

16.5%

(4.8%)

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Earnings estimates provided by Zacks.

At the time this article was published

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