6 Top Energy Stocks Likely to Beat Earnings Estimates

By Lee Jackson Published Jul 14, 8:30AM EDT

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This week the landslide of second-quarter earnings results will start pouring in, and many on Wall Street are expecting some solid numbers across the board. One sector that has had strong pricing support through the quarter has been energy. With West Texas Intermediate holding at or above $100 per barrel for an extended period, some oil and gas company earnings could come in much higher than anticipated.

A new research report from Stifel highlights six oil and gas stocks that may have the ability to report second-quarter earnings that are higher than current Wall Street expectations. Investors looking for solid energy ideas to add to their portfolios may want to look at names that can surprise to the upside.

Anadarko Petroleum Corp. (NYSE: APC) is one of the biggest independent oil and gas producers in the country, with exploration or production work in all major domestic drilling areas as well as in South America, Africa, Asia and New Zealand. Worldwide, natural gas makes up just over half of Anadarko’s reserves, but 87% of the new wells it drilled in the United States last year were gas wells. The company has daily production over 2.6 billion cubic feet. Investors are paid a 1% dividend. The Thomson/First Call consensus price target for the stock is $120. Anadarko closed Friday at $104.78.

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Canadian Natural Resources Ltd. (NYSE: CNQ) is quickly becoming a Wall Street favorite and is considered one of the top Canadian oil stocks with the largest reserve base among their peers. The company also recently purchased Devon Energy’s conventional properties in Canada for more than $3 billion Canadian. Investors are paid a 1.8% dividend. The consensus price target is $50.76. The stock closed Friday at $44.34 a share.

EOG Resources Inc. (NYSE: EOG) is another top name the Stifel team feels can beat current estimates. The company is fueling record oil and natural gas production that is revolutionizing the U.S. energy position. Its position in the three biggest tight oil plays makes it a huge player in the exploration and production (E&P) field. EOG is the top producer in the Eagle Ford Shale and it has solid positions in both the Bakken and Permian Basin. Investors are paid a tiny 0.4% dividend. The consensus price target is $118.66. EOG closed Friday at $113.65.

Noble Energy Inc. (NYSE: NBL) should have almost 54% of its total 2014 production in the form of natural gas, which combined with higher spot pricing in the quarter could boost earnings. The company is also one of the many American firms expected to benefit when Mexico opens the door for E&P from outside companies for the first time in 70 years. The company has substantially boosted its spending to take advantage of higher oil and gas prices. Investors are paid a small 0.9% dividend. The consensus price target is $86.86. Nobel closed trading Friday at $73.69.

Pioneer Natural Resources Co. (NYSE: PXD) is a huge player in the Permian basin and the Eagle Ford in Texas, and it has been a big winner for shareholders. The company was named by the U.S. Commerce Department to produce and export condensate. Rumors have swirled over the past year that one of the big integrated oil players may target Pioneer as a takeover candidate. It would be a very expensive deal as the company’s market cap is almost $34 billion. The consensus target price is $240.38. Pioneer closed Friday at $222.42.

Suncor Energy Inc. (NYSE: SU) is another top Canadian oil producer and a major player in the vast oil sands in Canada. It recently announced a deal with blue-chip industrial behemoth General Electric aimed at improving the environmental performance of the oil sands in Alberta. The deal has created an investment opportunity of about $18 million. With environmental pressure a huge industry concern, this could prove a solid move for the long term. Investors are paid a 2% dividend. The consensus price target is $48.45. Shares closed trading Friday at $41.20.

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These six top names are good additions to any growth portfolio, even if they just hit Wall Street estimates. Coming in above the consensus expectations could really give the stocks a lift. Many of the stocks closed down last week, as oil prices traded lower, offering investors a better entry point.

About the Author Lee Jackson →

Lee Jackson has covered Wall Street analysts' equity and debt research and equity strategy daily for 24/7 Wall St. since 2012. His broad and diverse career, which included a stint as the creative services director at the NBC affiliate in Austin, Texas, gives him unique insight into the financial industry and world.

Lee Jackson's journey in the financial industry spans over 30 years, with nearly two decades as an institutional equity salesperson at Bear Stearns, Lehman Brothers, and Morgan Stanley. His career was marked by his presence on the sell side during pivotal Wall Street events, from the dot.com rise and bubble to the Long Term Capital Management debacle, 9/11, and the Great Recession of 2008. This is a testament to his resilience and adaptability in the face of market volatility.

Lee Jackson’s practical financial industry experience, acquired from a career at some of the biggest banks and brokerage firms, is complemented by a lifetime of writing on various platforms. This unique combination allows him to shed light on the intricacies and workings of Wall Street in a way that only someone with deep insider experience and knowledge can. Moreover, his extensive network across Wall Street continues to provide direct access for him and 24/7 Wall St., a privilege few firms enjoy.

Since 2012, Jackson’s work for 24/7 Wall St. has been featured in Barron’s, Yahoo Finance, MarketWatch, Business Insider, TradingView, Real Money, The Street, Seeking Alpha, Benzinga, and other media outlets. He attended the prestigious Cranbrook Schools in Bloomfield Hills, Michigan, and has a degree in broadcasting from the Specs Howard School of Media Arts.