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Magellan (MMP) Q4 Earnings Top Estimates, Sales Miss Mark
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Magellan Midstream Partners, L.P. recently reported fourth-quarter 2020 adjusted earnings per unit of 94 cents, beating the Zacks Consensus Estimate of 84 cents. The better-than-anticipated earnings are attributable to reduced expenses and additional revenues from the firm’s refined products pipeline system, resulting from shipments and average tariff rates beyond its expectations.
However, the bottom line fell 28.2% from the year-ago profit of $1.31. Lower refined products demand and a decline in commodity price due to coronavirus-induced disruptions hampered results.
Also, quarterly revenues of $586 million missed the Zacks Consensus Estimate of $628 million. Further, the top line decreased from the year-ago sales of $741 million.
Segmental Performance
Refined Products: Revenues of $445.5 million were down from the year-ago period’s $576.9 million.Notably, total volumes shipped in the quarter under review were 124.5 million barrels compared with 131 million barrels a year ago. Operating margin from the segment declined to $249.6 million in the fourth quarter from $296.3 million in the corresponding period of 2019.
Crude Oil: Quarterly revenues grossed $142.3 million, down 14% year over year on the back of lower volumes. Total volumes shipped in the quarter were 62 million barrels, down from 78.1 million barrels a year ago. Operating margin contracted to $109.8 million from $153 million in the prior year.
DCF & Balance Sheet
Magellan Midstream’s distributable cash flow (DCF) for the fourth quarter summed $269.7 million, dropping 24.6% from the year-ago level.
Notably, on Jan 26, the partnership announced fourth-quarter cash distribution of $1.0275 per unit ($4.11 on an annualized basis), representing 1% annual growth. The amount is payable Feb 12 to its unitholders of record as of Feb 5.
As of Dec 31, 2020, the firm had cash and cash equivalents worth $13 million, and a long-term debt of $5 billion.
Magellan Midstream Partners, L.P. Price, Consensus and EPS Surprise
As the economy is on the mend from the coronavirus-caused oil price crash, management expects to generate distributable cash flows of $1,020 million for the full year and also plans to retain the current level of cash distribution for the rest of the year. Magellan Midstream projected first-quarter 2021 earnings per unit of 75 cents while the same for the full year is anticipated to be $3.55.
The firm plans to spend $75 million in the ongoing year on completing certain expansion projects.
Zacks Rank & Key Picks
Magellan Midstream currently has a Zacks Rank #5 (Strong Sell).
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Magellan (MMP) Q4 Earnings Top Estimates, Sales Miss Mark
Magellan Midstream Partners, L.P. recently reported fourth-quarter 2020 adjusted earnings per unit of 94 cents, beating the Zacks Consensus Estimate of 84 cents. The better-than-anticipated earnings are attributable to reduced expenses and additional revenues from the firm’s refined products pipeline system, resulting from shipments and average tariff rates beyond its expectations.
However, the bottom line fell 28.2% from the year-ago profit of $1.31. Lower refined products demand and a decline in commodity price due to coronavirus-induced disruptions hampered results.
Also, quarterly revenues of $586 million missed the Zacks Consensus Estimate of $628 million. Further, the top line decreased from the year-ago sales of $741 million.
Segmental Performance
Refined Products: Revenues of $445.5 million were down from the year-ago period’s $576.9 million.Notably, total volumes shipped in the quarter under review were 124.5 million barrels compared with 131 million barrels a year ago. Operating margin from the segment declined to $249.6 million in the fourth quarter from $296.3 million in the corresponding period of 2019.
Crude Oil: Quarterly revenues grossed $142.3 million, down 14% year over year on the back of lower volumes. Total volumes shipped in the quarter were 62 million barrels, down from 78.1 million barrels a year ago. Operating margin contracted to $109.8 million from $153 million in the prior year.
DCF & Balance Sheet
Magellan Midstream’s distributable cash flow (DCF) for the fourth quarter summed $269.7 million, dropping 24.6% from the year-ago level.
Notably, on Jan 26, the partnership announced fourth-quarter cash distribution of $1.0275 per unit ($4.11 on an annualized basis), representing 1% annual growth. The amount is payable Feb 12 to its unitholders of record as of Feb 5.
As of Dec 31, 2020, the firm had cash and cash equivalents worth $13 million, and a long-term debt of $5 billion.
Magellan Midstream Partners, L.P. Price, Consensus and EPS Surprise
Magellan Midstream Partners, L.P. price-consensus-eps-surprise-chart | Magellan Midstream Partners, L.P. Quote
2021 Outlook
As the economy is on the mend from the coronavirus-caused oil price crash, management expects to generate distributable cash flows of $1,020 million for the full year and also plans to retain the current level of cash distribution for the rest of the year. Magellan Midstream projected first-quarter 2021 earnings per unit of 75 cents while the same for the full year is anticipated to be $3.55.
The firm plans to spend $75 million in the ongoing year on completing certain expansion projects.
Zacks Rank & Key Picks
Magellan Midstream currently has a Zacks Rank #5 (Strong Sell).
Some better-ranked players in the energy space are DCP Midstream Partners, LP , Plains Group Holdings, L.P. (PAGP - Free Report) and Matador Resources Company (MTDR - Free Report) , each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>