Chesapeake Energy Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Chesapeake Energy (NYSE:CHK) will unveil its latest earnings on Thursday, November 1, 2012. Chesapeake Energy is a company that explores and develops properties for the production of crude oil and natural gas from underground reservoirs.

Chesapeake Energy Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 9 cents per share, a decline of 87.5% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from 3 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 9 cents during the last month. For the year, analysts are projecting net income of 46 cents per share, a decline of 83.6% from last year.

Past Earnings Performance: The company has missed estimates in the last two quarters. In the second quarter, it missed the mark by 2 cents as a result of reporting profit of 6 cents against an estimate of net income of 8 cents per share. In the first quarter, the company fell short of forecasts by 11 cents.

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A Look Back: In the second quarter, profit rose 90.6% to $972 million ($1.29 a share) from $510 million (68 cents a share) the year earlier, but fell short analyst expectations. Revenue rose 2.1% to $3.39 billion from $3.32 billion.

Wall St. Revenue Expectations: Analysts predict a decline of 38.9% in revenue from the year-earlier quarter to $2.43 billion.

Stock Price Performance: Between August 2, 2012 and October 26, 2012, the stock price rose $2.17 (12.1%), from $17.93 to $20.10. The stock price saw one of its best stretches over the last year between May 17, 2012 and May 31, 2012, when shares rose for 10 straight days, increasing 24.7% (+$3.35) over that span. It saw one of its worst periods between November 11, 2011 and November 25, 2011 when shares fell for 10 straight days, dropping 15.2% (-$4.03) over that span.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 54.1% in the third quarter of the last fiscal year, 38.1% in the fourth quarter of the last fiscal year and 50.1% in the first quarter before increasing again in the second quarter.

Analyst Ratings: There are mostly holds on the stock with 18 of 28 analysts surveyed giving that rating.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.72 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations.

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

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