SM Energy Company SM has witnessed upward estimate revisions for 2022 and 2023 earnings in the past 30 days. Further, the leading upstream energy firm is likely to record earnings growth of 257.8% and 18% in 2022 and 2023, respectively.
Factors Working in Favor
The price of West Texas Intermediate crude, trading at more than $100 per barrel, has improved drastically over the past year. The significant rise in oil price is owing to Russia’s violent and unprovoked invasion of Ukraine.
SM Energy, a leading oil and natural gas exploration and production company sporting a Zacks Rank #1 (Strong Buy), is well placed to capitalize on the crude rally. In the prolific Midland basin, a sub-basin of the broader Permian basin, the company is laying out 2022 plans to drill roughly 55 net wells and complete almost 40 net wells. In South Texas, SM Energy is planning to complete roughly net 38 wells.
The resources wherein SM Energy is operating have low breakeven costs. This, in turn, secures handsome cash flows for the company at higher commodity prices. Thus, with oil price trading at a high level, it could be safely said that SM Energy is generating significant cash flows.
Another piece of news that has pleased investors is that SM Energy’s proved reserves for 2021 have increased 22%.
SM Energy Company Price
SM Energy Company price | SM Energy Company Quote
Other Stocks to Consider
Other top-ranked players in the energy space include Exxon Mobil Corporation XOM, ConocoPhillips COP and Chevron Corporation CVX, each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
ExxonMobil is banking on key upstream projects centered around Permian — the most prolific basin in the United States — and offshore Guyana resources.
ExxonMobil reported strong fourth-quarter results, thanks to improved realized oil and natural gas prices as well as higher refining and chemical margins. In the past seven days, ExxonMobil has witnessed upward earnings estimate revisions for 2022.
Considering production and proved reserves, ConocoPhillips is one of the leading upstream energy players. In the past 30 days, ConocoPhillips has witnessed upward earnings estimate revisions in the past 30 days.
ConocoPhillips’ earnings estimates for 2022 stand at $10.19 per share, suggesting a year-over-year increase of 69.6%.
In the Permian basin, Chevron has a strong footprint. The majority of Chevron’s assets in the most prolific basin of the United States have minimal royal payments, thereby securing handsome cash flows in the long run.
In the past 30 days, Chevron has witnessed upward earnings estimate revisions for 2022.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
