Subscribe to Entrepreneur for $5
Subscribe

Earnings Estimates Rising for APA (APA): Will It Gain?

APA (APA) shares have started gaining and might continue moving higher in the near term, as indicated by solid earnings estimate revisions.

By
This story originally appeared on Zacks

Investors might want to bet on APA (APA), as earnings estimates for this company have been showing solid improvement lately. The stock has already gained solid short-term price momentum, and this trend might continue with its still improving earnings outlook.

- Zacks

The rising trend in estimate revisions, which is a result of growing analyst optimism on the earnings prospects of this oil and natural gas producer, should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. This insight is at the core of our stock rating tool -- the Zacks Rank.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

For APA, there has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year.

The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:

12 Month EPS

Current-Quarter Estimate Revisions

The earnings estimate of $0.82 per share for the current quarter represents a change of +612.5% from the number reported a year ago.

Over the last 30 days, the Zacks Consensus Estimate for APA has increased 20.51% because three estimates have moved higher while one has gone lower.

Current-Year Estimate Revisions

The company is expected to earn $3.42 per share for the full year, which represents a change of +416.67% from the prior-year number.

There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, four estimates have moved up for APA versus no negative revisions. This has pushed the consensus estimate 6.88% higher.

Favorable Zacks Rank

The promising estimate revisions have helped APA earn a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

APA shares have added 21.2% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.



Time to Invest in Legal Marijuana

If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.

After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%.

You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.

Today, Download Marijuana Moneymakers FREE >>



Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

 

APA Corporation (APA): Free Stock Analysis Report

 

To read this article on Zacks.com click here.

 

Zacks Investment Research