Cabot Oil & Gas Beats on EPS but GAAP Results Lag

Cabot Oil & Gas (NYSE: COG  ) reported earnings on Feb. 20. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Cabot Oil & Gas beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share contracted significantly.

Gross margins contracted, operating margins increased, net margins dropped.

Revenue details
Cabot Oil & Gas recorded revenue of $268.0 million. The six analysts polled by S&P Capital IQ anticipated sales of $258.5 million on the same basis. GAAP reported sales were 24% higher than the prior-year quarter's $216.9 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.20. The 19 earnings estimates compiled by S&P Capital IQ anticipated $0.16 per share on the same basis. GAAP EPS of $0.13 for Q4 were 43% lower than the prior-year quarter's $0.23 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 75.5%, 650 basis points worse than the prior-year quarter. Operating margin was 26.7%, 1,260 basis points better than the prior-year quarter. Net margin was 9.8%, 1,280 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $284.1 million. On the bottom line, the average EPS estimate is $0.15.

Next year's average estimate for revenue is $1.33 billion. The average EPS estimate is $0.78.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 484 members out of 532 rating the stock outperform, and 48 members rating it underperform. Among 121 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 114 give Cabot Oil & Gas a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cabot Oil & Gas is outperform, with an average price target of $47.69.

Are you missing a major story in the energy space? Read about "One Stock to Own Before Nat Gas Act 2011 Becomes Law." Click here for instant access to this free report.

• Add Cabot Oil & Gas to My Watchlist.