Oasis Petroleum Inc. (NYSE:OAS) will announce its second quarter earnings on August 3, 2016, waiting to see if a recent bounce back in oil prices had an impact after back to back quarters of losses. A steep decline in earnings per share in the second quarter compared to the first quarter is the last thing investors would wish to hear, given that oil prices have stabilized above the $40 a barrel mark.
The street, however, does not expect a big improvement given the level of uncertainty in the energy sector. Given that, Oasis Petroleum is expected to lose money in fiscal 2016 and 2017 a small improvement from the first quarter could help bolster its sentiments on the Street.
The stock is down by 41.08% for the year, its earnings having also taken a beating on low oil prices. The sharp decline presents a perfect an opportunity for investors who like to buy on a dip given that the stock is way off its 52-week high of $14.15 a share.
Oasis Petroleum Prospects
The independent exploration and production company could make some money on oil prices rising above the $50 a barrel mark or remaining range bound at the current levels. The Bakken shale one of America’s oil plays is especially of interest, given that it could help Oasis Petroleum make some profits on oil prices stabilizing above the $40 a barrel mark.
Oasis Petroleum, unlike other drilling companies, has nearly three decades of drilling inventory that are viable at current oil prices. Its stock could rise from the current trading range of between $8.35 a share and $8.90 on oil prices and overall sentiment in the industry improving.
However, ahead of the upcoming earnings report, shareholders and interested investors will have to contend with a string of weaknesses with regards to Oasis Petroleum Inc.(NYSE:OAS) prospects. Deteriorating net income, weak operating cash flow and feeble growth in earnings per share in the recent past all but continues to raise concerns on the Street.