Sanchez Energy Earnings: Here’s Why Investors are Not Excited Now

Sanchez Energy Corporation (NYSE:SN) 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 11.95%.

Sanchez Energy Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $0.17 in the quarter versus EPS of $0.00 in the year-earlier quarter.

Revenue: Rose 834.81% to $59.08 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Sanchez Energy Corporation reported adjusted EPS income of $0.17 per share. By that measure, the company missed the mean analyst estimate of $0.28. It missed the average revenue estimate of $61.98 million.

Quoting Management: Tony Sanchez, III, President and Chief Executive Officer of Sanchez Energy, commented: “Our second quarter of 2013 was marked by substantial reserve, production and revenue growth as a result of increasing well count, well performance, results of tighter spacing pilots, and the closing on June 1st of our Cotulla acquisition. Specifically, in our Cotulla area we have increased production volumes from approximately 4,500 Boe/d when we announced the transaction to a current rate in excess of 6,000 Boe/d.”

Key Stats (on next page)…

Revenue increased 91.82% from $30.8 million in the previous quarter. EPS increased 30.77% from $0.13 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.50 to a profit $0.43. For the current year, the average estimate has moved up from a profit of $1.41 to a profit of $1.44 over the last ninety days.

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