Talisman Energy Earnings: Here’s Why the Stock is Up Now

Talisman Energy Inc. (NYSE:TLM) had a loss 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 up 2%, however.

Talisman Energy Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased to $-0.10 in the quarter versus EPS of $0.11 in the year-earlier quarter.

Revenue: Decreased 22.86% to $1.61 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Talisman Energy Inc. reported adjusted EPS loss of $-0.10 per share. By that measure, the company missed the mean analyst estimate of $0.05. It missed the average revenue estimate of $1.76 billion.

Quoting Management: “At the end of October 2012, Talisman announced a shift in strategic direction, and several months in, we are making progress,” said Hal Kvisle, President and CEO. “Our overriding objective is to significantly improve total shareholder returns by improving cash margins on the barrels we produce, more careful allocation of capital and better execution within a focused portfolio. Within this context, we have set four strategic priorities. First, we will live within our means, reducing investment to live within cash flow. We will strengthen our balance sheet, allowing us to respond to quality opportunities within our core regions. Our 2013 capital budget has been set at approximately $3 billion, a 25% reduction from 2012.”

Key Stats (on next page)…

Revenue decreased 6.74% from $1.72 billion in the previous quarter. EPS decreased to $-0.10 in the quarter versus EPS of $-0.04 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 $0.15 to a profit $0.13. For the current year, the average estimate has moved down from a profit of $0.36 to a profit of $0.28 over the last ninety days.

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