Get ready, investors and traders! CNX Resources Corporation (CNX) is set to release its third-quarter 2023 earnings on October 25th, before the market opens. In the previous quarter, CNX delivered an impressive earnings surprise of 20.8%. Let’s dive into what to expect from this upcoming earnings report and analyze the factors that could impact the results.
Factors to Watch
In the third quarter, CNX Resources is expected to have benefited from its strong free cash flow generation and utilization. The company likely utilized these funds to repurchase shares and reduce its debts, which in turn could have given a boost to its earnings. Additionally, as CNX Resources owns its midstream system, it may have benefited from low production costs and independence from other midstream systems. The systematic repayment of debts also allowed the company to lower its interest expenses, ultimately benefitting its bottom line. Furthermore, stable production from the Marcellus and Utica shales could have enabled CNX to increase its overall production volume.
Earnings and Revenue Expectations
Analysts estimate that CNX Resources will report earnings of 26 cents per share for the third quarter, representing a significant year-over-year increase of 148.2%. However, revenue is expected to decline, with the consensus estimate at $388.9 million, reflecting an 18.3% decrease compared to the same period last year.
The Zacks Consensus Estimate for total production volumes is 140 billion cubic feet equivalent, up 4.5% from the previous quarter. The consensus estimate for the average gas sales price is $1.52 per thousand cubic feet equivalent, down 15.6% sequentially. Similarly, the Zacks Consensus Estimate for the average sales price of natural gas liquids is $20.54 per barrel, down 7.7% from the previous quarter. On the other hand, the average sales price of Oil/Condensate is expected to be $73 per barrel, up 15.9% sequentially.
Zacks Model Prediction
Our proven model predicts a potential earnings beat for CNX Resources this quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy), or #3 (Hold) increases the likelihood of an earnings beat. In the case of CNX Resources, its positive Earnings ESP of +10.35% and a Zacks Rank #3 provide a favorable outlook for the upcoming earnings report.
Other Stocks to Consider
If you’re looking for more investment opportunities in the same sector, consider the following stocks that have the potential for an earnings beat:
- Hess Corporation (HES): Earnings ESP of +6.03% and a Zacks Rank #2.
- Devon Energy Corporation (DVN): Earnings ESP of +2.27% and a Zacks Rank #2.
- Constellation Energy Corporation (CEG): Earnings ESP of +2.42% and a Zacks Rank #1.
These stocks have strong potential for positive earnings surprises and are worth considering in your investment strategy.
Conclusion
With the release of CNX Resources’ third-quarter earnings approaching, investors and traders have much to look forward to. Based on the analysis of key factors, expectations for earnings and revenue, and insights from our Zacks model, CNX Resources has the potential to deliver positive results. Keep a close eye on the company’s performance and consider other stocks in the sector that exhibit promising earnings potential.
