With the earnings season well on its way, many investors still remain understandably skeptical about several commodity producers’ fourth-quarter reports as global economic uncertainties and demand concerns continue to plague the market. Earnings results thus far have been mixed, while lackluster economic data weighs heavily on commodities. Last week, however, oil giants Exxon Mobil (XOM) and Chevron Corporation (CVX) both posted solid Q4 profits, exceeding analysts’ expectations. Chevron’s victory, however, was short-lived after analysts at UBS cut its stock recommendation [for more commodity news and analysis subscribe to our free newsletter].
- TC PipeLines L.P. (TCP): This relatively small oil and gas MLP is expected to post fourth-quarter revenues of $58.3 million, up 6.2% from the prior-year quarter. Earnings per share estimates, however, are expected to drop 10% to $0.63. Last quarter, EPS came in at $0.64 while revenues were reported at $48 million. In general, analysts’ recommendations on TCP is hold [see Keystone XL Pipeline: The Good, Bad And Ugly].
- Louisiana-Pacific Corp. (LPX): Analysts are quite bullish on this building materials supplier, raising EPS estimates from $0.12 to $0.20 over the last three months. The upward estimates trend is largely due to the improving housing market and increase in new home construction activities. In addition, the company expects that this increased housing market activity combined with overall price appreciation will boost top line growth.
- Brookfield Infrastructure Partners L.P. (BIP): Another MLP, this diversified basic materials firm, which dabbles in everything from energy to timber, is expected to post earnings per share at $0.32 for the fourth quarter. Year-end quarterly profit is expected to be reported at $504.4 million, a growth of nearly 25% over the trailing one-year period. Analysts have dropped their EPS estimates over the last three months, from $0.37 to the current $0.32 estimate [see Steel Prices Heat Up].
Disclosure: No positions at time of writing.