Gulfport Energy [GPOR] Headed for a Bullish Reversal and Short-term Gains

Gulf Energy [NASDAQ:GDOR] has been building upside momentum over the last few days. This is not coincidental as the stock is trading at a key long-term support level. The momentum has been boosted by positive analyst reviews of the company.

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 Analyst Expect Gulf Energy to beat its earnings’ estimate in its upcoming financial report for the quarter ending September 30, 2020. The consensus outlook of a company’s financial estimate is an important consideration when looking at the company’s stock price. The stock price can either go higher or lower based on the earnings report. If the company reports earnings above expectations, the price is likely to move higher, if they miss those expectations, then the opposite happens. However, it is not always as clear cut. And here is why.

It is always worth it handicapping the possibility of positive earnings reports, even though the price is also largely dependent on the actions the business managers take.

Zacks Consensus Estimate

Zacks consensus estimates that the gas and energy company is likely to post a quarterly loss of $0.21 per share, representing about -187.5% in year-over-year change. The same estimate expects the revenue to plummet to $157.06 million, which will be about 44.9% as compared to the same quarter in 2019. 

Estimate Revisions Trend the Expected Surprise Prediction (ESP) for this quarter has seen a revision of 72.73% high than the last 30 days at the existing level. This revision is a reflection of the analysts’ reassessment of the initial estimate in this period. These estimates might not necessarily reflect the direction of the revision from each of the analysts. 

Price, Consensus, and EPS Surprise

Estimate revisions released before a company releases its earnings serve as a good way of predicting the condition of that company’s business in the period that those results are coming out. It is this insight that forms the core of the proprietary surprise prediction model otherwise called the Zacks Earnings Expected Surprise Prediction (EPS). The ESP compares a company’s most accurate Zacks consensus estimate for a particular period. The most accurate estimate is one that is the most recent EPS estimate. Here, analysts use up to date information to revise their estimates of a particular company just before it releases its earnings reports for that period. This model’s predictive power is biased towards positive EPS readings. 

How Gulfport Energy Numbers are Shaping Up?

For Gulfport Energy, the most accurate estimate is higher than the EPS Zacks Consensus Estimate; Analysts have of late been bullish on the company getting good earnings. As a result, the company has recorded Earnings ESP of +7.94% and the stock carries a Zacks Rank of £3. The bottom line with this is that betting on a stock expected to beat expectations like that of Gulfport Energy is a good investment prospect.