Next Tuesday, SandRidge Energy Inc. (NYSE:SD) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.
Along with many of its energy peers, SandRidge Energy Inc. (NYSE:SD) has struggled from the plunge in natural gas prices since early 2008. The poor pricing environment for energy products has forced it to sell assets at an inopportune time, and concerns about the company have only risen lately. Let’s take an early look at what’s been happening with SandRidge Energy Inc. (NYSE:SD) over the past quarter and what we’re likely to see in its quarterly report.
Stats on SandRidge Energy Inc. (NYSE:SD)
|Analyst EPS Estimate||($0.06)|
|Revenue Estimate||$479 million|
|Change From Year-Ago Revenue||25.5%|
|Earnings Beats in Past 4 Quarters||4|
Will SandRidge Energy Inc. (NYSE:SD)’s earnings start turning around this quarter?
Analysts have gotten more optimistic about SandRidge Energy Inc. (NYSE:SD) and its earnings in recent months, narrowing their loss estimates for the just-completed quarter by a penny per share and making an even bigger dime-per-share reduction to their expectations for a full-year 2013 loss. Yet investors remain unconvinced, as the stock has fallen nearly 30% just since late January.
SandRidge Energy Inc. (NYSE:SD) has made a huge bet on the Mississippian Lime shale play, especially after selling off its Permian Basin assets late last year. Unfortunately, that bet hasn’t paid off well for shareholders, as the company saw its spun-off royalty trusts SandRidge Mississippian Trust I (NYSE:SDT) and SandRidge Mississippian Trust II (NYSE:SDR) fail to meet their projections for distribution amounts during the first quarter. The main problem has been that wells in the Mississippian Lime have produced more natural gas than expected, and even with a slight rebound in gas prices, it still doesn’t produce adequate margins compared to oil and natural-gas liquids.