Why Is EQT Down 4% Since The Last Earnings Report?

It has been about a month since the last earnings report for EQT Corporation (NYSE:EQT) . Shares have lost about 4% in that time frame, underperforming the market.

Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Recent Earnings

EQT reported third-quarter 2017 adjusted earnings per share of 12 cents, against the Zacks Consensus Estimate of a loss of 5 cents. The bottom line also improved from a loss of 28 cents in the prior-year quarter.

Net operating revenues in the quarter rose 18.6% year over year to $660.3 million and surpassed the Zacks Consensus Estimate of $651 million.

The strong third-quarter results were supported by improved production sales volumes and average realized commodity prices.

Segment Details

EQT Production reported third-quarter adjusted operating revenues of $566.8 million, up 31.6% year over year.

Adjusted operating loss from this segment was $9.7 million, substantially narrower than $82.1 million loss in the year-earlier quarter.

The improvement was mainly driven by higher average realized commodity prices and increased production sales volumes.

In the EQT Gathering segment, net gathering revenues increased 17.6% year over year to $116.5 million.

Operating income rose 18.3% year over year to $85.8 million in the reported quarter.

Improvement in this segment can be attributed to production development in the Marcellus Shale.

In the EQT Transmission segment, net transmission revenues grew 16.9% to $90.7 million.

Operating income jumped 11.2% year over year to $59.7 million in the quarter under review.

The improvement in this segment occurred mainly due to the Marcellus Shale’s production development.

Financials

The company’s adjusted operating cash flow was $205.9 million during the quarter, up 23.7% year over year.

EQT’s capital expenditure in the quarter included $449.3 million spent on EQT Production, $48.2 million invested in EQT Gathering and $22.3 million in EQT Transmission.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month. There have been two revisions higher for the current quarter compared to three lower.

VGM Scores

At this time, the stock has a great Growth Score of A, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Based on our scores, the stock is more suitable for growth and momentum investors than value investors may want to look elsewhere.

Outlook

Estimates have been broadly trending downward for the stock and the magnitude of this revision also indicates a downward shift. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.