Disappointing results and downbeat guidance have led to downward estimates revisions, for oil and gas exploration company Kosmos Energy.
On May 9, 2013, Kosmos reported it first quarter 2013 results. Net income for the quarter came in at $20 million or $0.05 per share, 3 cents short of the Zacks Consensus Estimate of $0.08 per share.
The management provided downbeat guidance for the second quarter. The company also announced a delay in implementation of a key project in Morocco.
Due to disappointing results and downbeat guidance, quarterly and annual estimates have been revised sharply downwards in the past few weeks by analysts.
Zacks consensus estimate for the current quarter now stands at $0.05 per share versus $0.09 per share, 60 days ago, while the full-year consensus estimate is $0.25 per share now, down from $0.35 per share.
KOS is currently Zacks Rank # 5 (Strong Sell) stock and has a longer-term recommendation of “Underperform”. Furthermore, the Zacks Industry rank of 230 out of 265 also indicates weakness in the near- to mid- term. Oil and gas prices have been under pressure of late due to a strong U.S. dollar and slow-down in China and some other major emerging economies.
Thus we think investors should avoid this stock for the time being. The stock’s downward trend over the past few years can be seen in this chart:
