Cloud Peak Energy Inc CLD is scheduled to report first-quarter 2018 results on Apr 26. In the fourth quarter of 2017, the utility company reported a negative earnings surprise of 1500.00%.
Why Likely a Positive Surprise
A stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Per our model, Cloud Peak Energy is likely to beat earnings this quarter as it possesses these components.
Zacks ESP: The company’s Earnings ESP is +100.00%. This is because the Most Accurate estimate is at a breakeven, while the Zacks Consensus Estimate is pegged at a loss of 5 cents.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Cloud Peak Energy’s Zacks Rank #3, when combined with a positive Earnings ESP increases the possibility of a beat.
We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Factors to Consider
In 2017, Cloud Peak Energy exported 4.5 million tons of coal. The company expects to increase its export volumes to 5.5 million tons in 2018. Notably, increasing demand from some Asian countries like China, South Korea and Japan, is projected to boost Cloud Peak Energy’s coal production, which is likely to be reflected in the upcoming quarterly results.
Further, with Trump administration’s support for coal industry, the company has increased focus on shipment agreements, buoyed by improved rail and port systems. We may expect the yet-to-be-reported quarter’s results to reflect more such agreements.
During the first quarter, the United States witnessed colder-than-normal winter, which fueled demand for electricity and led to higher consumption of coal. This is likely to have bolstered the company’s domestic sales.
Other Stocks to Consider
Here are a few other players from the industry that have the right combination of elements to post an earnings beat this quarter.
SunCoke Energy Partners SXCP has an Earnings ESP of +6.67%. It carries a Zacks Rank #3 and is expected to report first-quarter 2018 results on Apr 26.
Warrior Met Coal Inc HCC has an Earnings ESP of +5.26%. It sports a Zacks Rank #1 and is expected to report first-quarter 2018 results on May 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Peabody Energy Corporation BTU is expected to report first-quarter 2018 results on Apr 25. The company has an Earnings ESP of +4.55% and a Zacks Rank #3.
The company has an Earnings ESP of +4.55% and a Zacks Rank #3.
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Peabody Energy Corporation (BTU): Free Stock Analysis Report
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