Concho Resources Earnings: Here’s Why Investors are Not Happy Now

Concho Resources, Inc. (NYSE:CXO) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 2.77%.

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Concho Resources, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 44.76% to $0.58 in the quarter versus EPS of $1.05 in the year-earlier quarter.

Revenue: Decreased 7.03% to $472.13 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Concho Resources, Inc. reported adjusted EPS income of $0.58 per share. By that measure, the company missed the mean analyst estimate of $0.79. It missed the average revenue estimate of $500.88 million.

Quoting Management: Tim Leach, Concho’s Chairman, CEO and President commented, “I am pleased with the operational performance of our business despite the unprecedented widening of the Permian oil basis differential during the quarter. Through the first three months of the year, I believe we are on track to deliver on our annual production guidance and capital budget. We continue to build upon our horizontal success in the Delaware Basin, where production increased 10% over the previous quarter. The Delaware Basin also contributed to overall oil growth of 3% over the previous quarter and will be a key source of oil growth for years to come.”

Key Stats (on next page)…

Revenue increased 23.7% from $381.67 million in the previous quarter. EPS decreased 39.58% from $0.96 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $1.02 to a profit $1.11. For the current year, the average estimate has moved up from a profit of $4.3 to a profit of $4.39 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)