Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and Global Partners is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.
The midstream and downstream segments of the energy industry have gotten a lot of attention lately, as high levels of oil and gas production have swamped the available capacity to move those products efficiently to where they're needed. Global Partners combines both segments under one roof, with an impressive logistical network and about 1,000 gas stations focused in the northeastern United States. Let's take an early look at what's been happening with Global Partners over the past quarter and what we're likely to see in its quarterly report on Thursday.
Stats on Global Partners
Analyst EPS Estimate
Change From Year-Ago EPS
Change From Year-Ago Revenue
Earnings Beats in Past 4 Quarters
Source: Yahoo! Finance.
Will Global Partners keep investors energetic this quarter?
Analysts have been cautious about Global Partners' near-term prospects but are highly bullish about its longer-term prospects. In the past few months, they've cut back on the master limited partnership's earnings per share by $0.02, but they've added more than $1.20 per share to their calls for the full 2013 year. The stock has responded similarly, soaring more than 60% since early December.
The big news for Global Partners came in January, when refining giant Phillips 66 announced a deal with Global Partners to ship oil from the Bakken shale play in North Dakota to a Phillips refinery facility in Pennsylvania. Under the five-year contract, Phillips 66 takes on a commitment to take about 91 million barrels of crude, or roughly 50,000 barrels per day, which puts the contract's value at about $8 billion given current prices for West Texas Intermediate. Because of a shortage of pipeline capacity serving the Bakken, Global plans to use its partnership with Canadian Pacific to send the oil by rail.
The Phillips 66 news caused Global Partners to raise its guidance for 2013. The MLP now expects EBITDA to grow at roughly a 50% pace this year compared with 2012. With the transportation deal adding about $10 to $15 per barrel to the price of crude, Global Partners is benefiting from the big disparity between global prices for Brent crude and the domestic price of oil linked to the WTI benchmark.
In its quarterly report, watch for Global Partners to discuss not just the Phillips 66 deal but also its acquisition of a crude oil and ethanol facility in Oregon. With both a marine terminal and huge ethanol production capacity, Global Partners is making its move to diversify geographically beyond its East Coast focus, which could lead to even further growth down the road.
There are many different ways to play the energy sector, and The Motley Fool's analysts have uncovered an under-the-radar company that's dominating its industry. Find out all about in our special free report: "The Only Energy Stock You'll Ever Need." Don't miss out on this limited-time offer and your opportunity to discover this promising stock before the market does. Click here to access your report -- it's totally free.
Click here to add Global Partners to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.
The article Global Partners Earnings: An Early Look originally appeared on Fool.com.
Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter: @DanCaplinger. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.