Are You Expecting This from Northern Oil and Gas?

Northern Oil and Gas (AMEX: NOG) is expected to report Q3 earnings on Nov. 8. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Northern Oil and Gas's revenues will grow 17.6% and EPS will increase 36.8%.

The average estimate for revenue is $81.2 million. On the bottom line, the average EPS estimate is $0.26.

Revenue details
Last quarter, Northern Oil and Gas reported revenue of $119.2 million. GAAP reported sales were 98% higher than the prior-year quarter's $35.6 million.

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

EPS details
Last quarter, non-GAAP EPS came in at $0.22. GAAP EPS of $0.70 for Q2 were 112% higher than the prior-year quarter's $0.33 per share.

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

Recent performance
For the preceding quarter, gross margin was 80.2%, 310 basis points worse than the prior-year quarter. Operating margin was 106.7%, 1,190 basis points better than the prior-year quarter. Net margin was 61.9%, 450 basis points better than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $313.8 million. The average EPS estimate is $1.02.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 589 members out of 649 rating the stock outperform, and 60 members rating it underperform. Among 103 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 87 give Northern Oil and Gas a green thumbs-up, and 16 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Northern Oil and Gas is buy, with an average price target of $27.73.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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  • Report this Comment On November 14, 2012, at 8:56 AM, lovesstocks2 wrote:

    Also the portfolio is well diversified up there in North Dakota, the acreage costs are well below average, and the results are extremely predictable, with very little chance of a dry hole for right now, and one of the lowest P/E's out there for such a nice growth rate, and in contrast to Kodiak, less leverage and more coverage.

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