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The third-quarter 2025 earnings season is underway, and several Oil/Energy companies have already shared their results. While analysts caution that falling oil prices could make this quarter challenging, the reality appears more encouraging.
So far, earnings have generally exceeded expectations, with a strong percentage of companies beating forecasts. Many energy players have delivered better-than-expected profits, helped by improved natural gas prices that have offset some of the weakness in crude. Overall, the sector’s performance has been more resilient than feared.
Based on our exclusive research and unique market insight, we present four stocks — Canadian Natural Resources Limited CNQ, Delek US Holdings DK, Calumet Specialty Products Partners CLMT and Northern Oil and Gas NOG — to take advantage of the positive post-announcement price reaction.
But it’s worth taking a look at the factors influencing the quarterly results this time around first.
Investors should know that there is a high correlation between commodity prices and the earnings of energy companies.
So, how does the price of oil and gas compare with the year-ago period?
According to the U.S. Energy Information Administration, average monthly WTI crude prices for July, August and September 2024 were $81.80, $76.68 and $70.24 per barrel, respectively. By comparison, prices declined to $68.39, $64.86 and $63.96 per barrel in the same order during the comparable months of 2025. This year-over-year drop highlights the weaker oil price environment in third-quarter 2025.
However, natural gas prices presented positive signals. In third-quarter 2025, U.S. Henry Hub average prices were $3.20 in July, $2.91 in August and $2.97 in September. These prices were significantly higher than the same months in 2024 — $2.07 in July, $1.99 in August and $2.28 in September.
Considering the drop in oil prices in particular, the picture looks somewhat downbeat for this earnings season. Per the latest Earnings Trends, energy is on track for an earnings decline compared to a year earlier. Per our expectations, the sector’s bottom line is likely to have fallen 4.9% from third-quarter 2024 though revenues are expected to have inched up 1%.
While energy investors have a few concerns, there’s also a positive side to the story. So far, about 37.5% of the S&P 500 companies have reported results, showing a strong 49.6% year-over-year earnings increase on 5% higher revenues.
This suggests that weak oil prices don’t necessarily mean all energy stocks have lost momentum. In fact, with better natural gas prices, disciplined cost control, and solid production, some players may post upside surprises. Encouragingly, nearly 78% of companies have exceeded both earnings and revenue estimates, pointing to a broadly strong earnings season.
Investing in companies with an earnings beat potential can fetch handsome returns. This is because a stock generally surges on an earnings beat.
With several energy firms thronging the investment space, it is by no means an easy task for investors to arrive at stocks that have the potential to deliver better-than-expected earnings. While it is impossible to be sure about such outperformers, our proprietary methodology makes it fairly simple.
Our research shows that for stocks with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), the chance of a positive earnings surprise is as high as 70%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP is our proprietary methodology for determining stocks that have the best chances to surprise with their next earnings announcement. It is the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate.
One might start with Canadian Natural Resources, which is one of the largest independent energy companies in Canada engaged in the exploration, development and production of oil and natural gas.
CNQ, with an Earnings ESP of +1.55% and a Zacks Rank #2, is scheduled to release third-quarter earnings on Nov. 6. Canadian Natural beat the Zacks Consensus Estimate in three of the last four quarters and missed in the other, which resulted in an earnings surprise of 7.1%, on average.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Canadian Natural Resources Limited price-eps-surprise | Canadian Natural Resources Limited Quote
Delek US Holdings also deserves mention. The company has a Zacks Rank of 3 and an Earnings ESP of +98.57%. Delek US Holdings is an independent refiner, transporter and marketer of petroleum products.
DK beat earnings estimates thrice in the last four quarters and missed in the other, the earnings surprise being 16.1%, on average. Delek US Holdings is set to release results on Nov. 7.
Delek US Holdings, Inc. price-eps-surprise | Delek US Holdings, Inc. Quote
You may consider Calumet Specialty Products Partners, too, which is #3 Ranked with an Earnings ESP of +29.48%. The Indianapolis, IN-based partnership is a downstream operator focusing on specialty products (oil, waxes, white oils etc.) and solutions, in addition to renewable diesel (or refining).
CLMT is scheduled to release earnings on Nov. 7. It beat the Zacks Consensus Estimate for earnings once in the last four quarters but missed three times, which resulted in an earnings surprise of -104.8%, on average.
Calumet, Inc. price-eps-surprise | Calumet, Inc. Quote
Finally, we have Northern Oil and Gas, an upstream operator that employs a unique strategy wherein it owns non-operating, minority interests in thousands of oil and gas wells, which are majority-owned and operated by some leading producers.
Northern Oil and Gas, with an Earnings ESP of +1.83% and a Zacks Rank #3, is scheduled to release earnings on Nov. 6. NOG surpassed earnings estimates in three of the trailing four quarters but missed in the other, with the average beat being 23.8%.
Northern Oil and Gas, Inc. price-eps-surprise | Northern Oil and Gas, Inc. Quote
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This article originally published on Zacks Investment Research (zacks.com).
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