Range Resources Earnings: Increased Profit Helps Beat the Street

S&P 500 (NYSE:SPY) component Range Resources Corporation (NYSE:RRC) reported net income above Wall Street’s expectations for the second quarter. Range Resources is an independent natural gas company that primarily explores and develops gas properties in the Southwestern and Appalachian regions of the United States.

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Range Resources Corporation Earnings Cheat Sheet

Results: Net income for Range Resources Corporation rose to $55.7 million (34 cents per share) vs. $51.3 million (32 cents per share) in the same quarter a year earlier. This marks a rise of 8.5% from the year-earlier quarter.

Revenue: Rose 32% to $442.4 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Range Resources Corporation beat the mean analyst estimate of a loss of one cent per share. It beat the average revenue estimate of $318.3 million.

Quoting Management: “Our second quarter results reflect excellent performance,” Jeff Ventura, Range’s President and CEO, said. “The benefits of our Barnett sale last year have positively impacted our second quarter operating and financial results. The sale allowed us to fast-forward the development of our core plays, improve our capital efficiency, lower our cost structure, and strengthen our financial position. The 42% increase in production coupled with a 16% decrease in aggregate cash unit costs are a vivid reflection of our performance combined with the sale benefits. While low natural gas prices impacted our financial results, our strong hedge position provided substantial protection. Looking ahead, we have approximately 80% of expected production hedged for the remainder of the year. We now expect our 2012 production growth to be 35%, or the high end of our previous full-year guidance. We also expect liquids growth in the fourth quarter to reach 40% compared to the fourth quarter of 2011. With the excellent drilling results in the first half of the year and our strong hedge position, we are well positioned to add material per share value in the second half of 2012.”

Key Stats:

The company has now surpassed analyst estimates for four quarters in a row. It beat the mark by 9 cents in the first quarter, by 2 cents in the fourth quarter of the last fiscal year, and by 4 cents in the third quarter of the last fiscal year.

Looking Forward: For the next quarter, analysts are growing pessimistic about the company’s expected results. The average estimate for the third quarter is 11 cents per share, dropping from 13 cents a month ago. Over the past sixty days, the average estimate for the fiscal year has reached 42 cents per share, a decline from 50 cents.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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