Earnings is fast approaching and sell-side firms around the globe are crunching numbers to help investors make sound investment decisions. Analysts are forecasting that Carrizo Oil & Gas, Inc. (NASDAQ:CRZO) is going to report earnings of $0.32 per share. The actual numbers will be released when the company reports earnings on or around 2017-02-27.
Before we delve into the numbers, let’s look at the surprise factor. Investors want to know right off the bat about the surprise factor. This helps them determine if an analyst is being overly optimistic or not. Recently Carrizo Oil & Gas, Inc. recorded a surprise factor of 21.05% and an Earnings Per Share of $0.04.
It’s all about the ABR
An investor wants to determine the consensus on a stock, and they can do that by looking at the average of a collection of analyst’s predictions on a particular stock’s equity. This average is known as the ABR (The Average Brokerage Recommendation). The average is based on a ranking system scored between 1 to 5, with 1 being a strong buy recommendation and 5 being a strong sell. Presently, Carrizo Oil & Gas, Inc. (NASDAQ:CRZO) has shares with an ABR of 1.35. The ABR is based on of 20. Investors need to be wary about this number because analysts can be overly optimistic on their ratings, especially if there is a conflict of interest at play.
Conflict of interest in the investment community? Happens all the time. Investors know this, so they have to be careful when a prediction seems a bit more positive than recent quarters. Of course, most analysts want to give the best forecasts possible based on reliable sources, but sometimes those predictions can be swayed if they have an existing relationship with that particular company. For example, if the analyst’s employer’s number one customer happens to be the company they’re analyzing, that can raise some red flags – mainly because the analyst doesn’t want to screw up that relationship. They might fluff their prediction to be better than it actually is. And this can move the market, so shouldn’t be taken lightly.
Another bit of information investors look at is the standard deviation. According to Zacks, the standard deviation for Carrizo Oil & Gas, Inc. (NASDAQ:CRZO) was $4.649. Analysts predict a price target range from $40 to $59 with a consensus target from the 20 analysts providing projections. The mean target is presently stands at $47.4. The mean target was last posted on 2017-01-06.
Let it rip!
Investors might have a lot of money at stake in a company – so they want to be informed on how that company is doing. Investors and analysts alike will look towards a company’s fundamentals, i.e. the cash flow and balance sheet to look for trends. But the one thing an investor cannot do is…nothing! An investor has to make a decision – whether to buy or to sell. If an investor gets caught up on the decision than doing nothing can sometimes be more harmful than making the wrong decision. We’ve all gotta roll the dice sometimes, but we first have to let the dice leave the hand.
Investors have a unique relationship with analysts. They rely on the information to make informed financial decisions. Analysts also rely on investors to hire them to help make those decisions. All financial decisions ultimately are up to the investor themselves. Looking at things like the surprise factor, ABR and mean target can be helpful at making those decisions.
Invest wisely. This post is intended to be used for informational purposes only . Investors should not use this article as a recommendation to buy or sell Carrizo Oil & Gas, Inc. (NASDAQ:CRZO) stock.