Stone Energy Earnings: Here’s Why Investors Like These Results

Stone Energy Corp. (NYSE:SGY) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down up 2.87%.

Stone Energy Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 25.81% to $0.78 in the quarter versus EPS of $0.62 in the year-earlier quarter.

Revenue: Rose 8.53% to $245.88 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Stone Energy Corp. reported adjusted EPS income of $0.78 per share. By that measure, the company beat the mean analyst estimate of $0.68. It beat the average revenue estimate of $222.97 million.

Quoting Management: Chairman, President and Chief Executive Officer David Welch stated, “We continue to see the benefit of our strategy to transition from our legacy conventional shelf Gulf of Mexico assets to the higher potential Marcellus shale and GOM deep water. During the second quarter, average production increased to 272 MMcfe per day with the Marcellus shale contributing over 75 MMcfe per day and 16 – 18 additional wells expected to be brought on production during the second half of 2013. In the deep water, we expect to spud Stone’s first deep water operated well and participate in 2 to 3 non-operated deep water tests in the second half of 2013 as well as having a very exciting portfolio of deep water wells for 2014. With the success in Appalachia and the significant increased activity level in the deep water, we have engaged a financial advisor to market a portion of our conventional shelf, state water and onshore properties. This action is consistent with our long term strategy and will further increase our focus on the higher potential growth areas of the company.”

Key Stats (on next page)…

Revenue increased 5.2% from $233.73 million in the previous quarter. EPS decreased 4.88% from $0.82 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 $0.63 to a profit $0.66. For the current year, the average estimate has moved up from a profit of $2.64 to a profit of $2.82 over the last ninety days.

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