Send me real-time posts from this site at my email
Zacks

Suncor (SU) to Report Q2 Earnings: Here's What to Expect

Suncor Energy Inc. SU is set to release second-quarter 2021 results on Wednesday Jul 28. The current Zacks Consensus Estimate for the to-be-reported quarter’s profit is pegged at 36 cents per share while the same for revenues stands at $6.81 billion.

Let’s delve into the factors that might have impacted this Canadian energy giant’s performance in the June quarter. But it’s worth taking a look at its previous-quarter performance first.

Highlights of Q1 Earnings & Surprise History

In the last reported quarter, the Calgary, Alberta-based firm’s operating earnings per share came in at 39 cents, missing the Zacks Consensus Estimate of 44 cents. This lower-than-expected result is due to its ramped-down production from the exploration and production segment. The year-ago bottom line was a loss of 15 cents per share. This year-over-year outperformance is led by improved refined product sales and decreased operating, selling and general costs as a result of the company’s continuous cost-minimizing efforts.

Quarterly operating revenues of $6.82 billion came ahead of the Zacks Consensus Estimate of $6.3 billion. The top line also rose 17.9% from $5.78 billion in the year-ago quarter.

As far as earnings surprises are concerned, Suncor’s bottom line beat the Zacks Consensus Estimate in two of the last four quarters and missed the mark in the other two, delivering a surprise of 69.48%, on average. This is depicted in the graph below:

Suncor Energy Inc. Price and EPS Surprise

Suncor Energy Inc. price-eps-surprise | Suncor Energy Inc. Quote

Factors to Consider for Q2

Suncor’s average oil sands sales volumes in the first quarter were 695.4 thousand barrels per day (MBbls/d), up 8.6% from the year-ago quarter’s output of 640 MBbls/d, a trend that most likely continued in the second quarter on ramped-up utilization rates. Evidently, the Zacks Consensus Estimate for oil sands sales volumes is pegged at 606 MBbls/d, indicating an increase of 8.3% from year-ago quarter's reported figure. This upside is expected to have supported the company’s second-quarter revenues and cash flows.

The integrated energy company anticipates spending the majority of its money in the second and the third quarter of each year as it attempts to complete all its maintenance work between April and October and leave only little for the winter months. Consequently, Suncor's increased capital expenditures are expected to have escalated its costs, hampering its earnings in the quarter under review.

What Does Our Model Say?

The proven Zacks model does not conclusively predict a beat for Suncor this earnings season. The combination of a positive  Earnings ESP  and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Suncor has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 36 cents per share each.

Zacks Rank: Suncor has a Zacks Rank #3, currently. You can see  the complete list of today’s Zacks #1 Rank stocks here.

Stocks to Consider

While an earnings beat looks uncertain for Suncor, here are some firms from the  energy  space that you may want to consider on the basis of our model:

Ovintiv Inc.  OVV has an Earnings ESP of +14.49% and a Zacks Rank of 1, currently. The firm is scheduled to release earnings on Jul 27.

Range Resources Corporation  RRC has an Earnings ESP of +3.51% and is Zacks #1 Ranked, presently. The firm is scheduled to release earnings on Jul 26.

Murphy USA Inc. MUSA has an Earnings ESP of +12.58% and is Zacks #3 Ranked at present. The firm is scheduled to release earnings on Jul 28.


Infrastructure Stock Boom to Sweep America

A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.

The only question is “Will you get into the right stocks early when their growth potential is greatest?”

Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.

Download FREE: How to Profit from Trillions on Spending for Infrastructure >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Range Resources Corporation (RRC): Free Stock Analysis Report
 
Suncor Energy Inc. (SU): Free Stock Analysis Report
 
Murphy USA Inc. (MUSA): Free Stock Analysis Report
 
Ovintiv Inc. (OVV): Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research

Welcome! Is it your First time here?

What are you looking for? Select your points of interest to improve your first-time experience:

Apply & Continue