National Oilwell Varco Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component National Oilwell Varco (NYSE:NOV) will unveil its latest earnings tomorrow, Friday, February 1, 2013.  National Oilwell Varco provides equipment and components used in oil and gas drilling and production operations, oilfield services, and supply chain integration services.

National Oilwell Varco Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of $1.44 per share, a rise of 5.1% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $1.48. Between one and three months ago, the average estimate moved down. It has been unchanged at $1.44 during the last month. For the year, analysts are projecting profit of $5.86 per share, a rise of 22.9% from last year.

Past Earnings Performance: The company has beaten estimates the last four quarters and is coming off a quarter where it topped forecasts by one cent, reporting net income of $1.52 per share against a mean estimate of profit of $1.51 per share.

Start 2013 better than ever by saving time and making money with your Limited Time Offer for our highly-acclaimed Stock Picker Newsletter. Click here for our fresh Feature Stock Pick now!

Wall St. Revenue Expectations: On average, analysts predict $5.3 billion in revenue this quarter, a rise of 24.4% from the year-ago quarter. Analysts are forecasting total revenue of $19.66 billion for the year, a rise of 34.1% from last year’s revenue of $14.66 billion.

A Look Back: In the third quarter, profit rose 15% to $612 million ($1.43 a share) from $532 million ($1.25 a share) the year earlier, exceeding analyst expectations. Revenue rose 42.2% to $5.32 billion from $3.74 billion.

Here’s how National Oilwell Varco traded following its last earnings report 3 months ago and leading up to its upcoming earnings report this week:

nov

Stock Price Performance: From December 27, 2012 to January 28, 2013, the stock price rose $6.65 (9.9%), from $66.97 to $73.62. The stock price saw one of its best stretches over the last year between March 27, 2012 and April 3, 2012, when shares rose for six straight days, increasing 3.1% (+$2.46) over that span. It saw one of its worst periods between April 30, 2012 and May 9, 2012 when shares fell for eight straight days, dropping 10.6% (-$8) over that span.

Key Stats:

The company enters this earnings announcement with substantial revenue momentum. The company has averaged year-over-year revenue growth of 37% over the last four quarters.

This upcoming earnings announcement will be a chance to build on positive earnings momentum over the last three quarters. Net income rose 48.9% in the first quarter and 25.8% in the second quarter before increasing again in the third quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.41 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.

Analyst Ratings: With 19 analysts rating the stock a buy, none rating it a sell and three rating the stock a hold, there are indications of a bullish stance by analysts.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

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