It has been about a month since the last earnings report for PDC Energy . Shares have added about 14.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is PDC Energy due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
PDC Energy Q2 Earnings and Revenues Beat Estimates
PDC Energyreported adjusted earnings per share of $1.66 for second-quarter 2021, ahead of the Zacks Consensus Estimate of $1.19 as well as the year-ago reported quarter’s 14 cents. This outperformance can be primarily attributed to better-than-anticipated total production and oil price realizations. The company’s output of 17,424 thousand barrels of oil-equivalent (MBoe) outpaced the Zacks Consensus Estimate of 17,407 MBoe. Also, PDC Energy’s oil price realization came in at $65.05 per barrel, surpassing the Zacks Consensus Estimate of $63.
The upstream operator recorded total revenues of $537.12 million, beating the consensus mark by 12.95% and also the year-ago quarter’s sales of $175.2 million.
Production & Prices
For the second quarter of 2021, PDC Energy’s production totaled 17,424 MBoe (58.5% liquids), reflecting an increase of 1% from 17,248 MBoe a year ago. Of the aggregate output, 15,213 MBoe (or 87.3%) came from Wattenberg Field and the rest from Delaware Basin.
The average realized natural gas price increased from 76 cents per Mcf in the year-ago quarter to $1.98. PDC Energy sold NGLs at an average price of $20.11 per barrel compared with $6.38 a year ago. The average oil price realization came in at $65.05 per barrel, 249% higher than $18.63 in the year-ago period. Overall, the company fetched $30.6 per MBoe compared with $10.08 a year ago.
Capital Expenditure & Balance Sheet
The energy explorer shelled out $180 million in the form of oil and gas capital investments. As of Jun 30, 2021, PDC Energy had $109.7 million in cash and cash equivalents, and $1.24 billion as long-term debt, representing a debt-to-capitalization of 33.5%.
Guidance
The company expects to churn out 190,000-195,000 Boe per day in 2021. It reiterated its oil production guidance of 64,000-66,000 barrel per day. The company still expects to spend between $550 million and $600 million this year. It lifted its free cash flow (FCF) generation forecast to above $800 million (at a WTI price of $65, natural gas at $3.50 and NGL at $20) for 2021.
The energy player expects more than $200 million for third-quarter FCF, based on its updated commodity pricing projections. The company plans to spend roughly $150 million in the same period of 2021 to run a full-time drilling rig in each basin and a Wattenberg completion crew. It anticipates a 5-10% rise in total daily output and a 15-20% increase in daily oil production, sequentially.
By 2025, this Denver, CO-based energy player plans to reduce its GHG and methane emissions by 60% and 50%, respectively. The firm is now more committed to coordinate with the World Bank to achieve zero routine flaring by 2025, having preponed it 2030 as previously stated.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -6.11% due to these changes.
VGM Scores
At this time, PDC Energy has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, PDC Energy has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is PDC Energy (PDCE) Up 14.7% Since Last Earnings Report?
It has been about a month since the last earnings report for PDC Energy . Shares have added about 14.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is PDC Energy due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
PDC Energy Q2 Earnings and Revenues Beat Estimates
PDC Energyreported adjusted earnings per share of $1.66 for second-quarter 2021, ahead of the Zacks Consensus Estimate of $1.19 as well as the year-ago reported quarter’s 14 cents. This outperformance can be primarily attributed to better-than-anticipated total production and oil price realizations. The company’s output of 17,424 thousand barrels of oil-equivalent (MBoe) outpaced the Zacks Consensus Estimate of 17,407 MBoe. Also, PDC Energy’s oil price realization came in at $65.05 per barrel, surpassing the Zacks Consensus Estimate of $63.
The upstream operator recorded total revenues of $537.12 million, beating the consensus mark by 12.95% and also the year-ago quarter’s sales of $175.2 million.
Production & Prices
For the second quarter of 2021, PDC Energy’s production totaled 17,424 MBoe (58.5% liquids), reflecting an increase of 1% from 17,248 MBoe a year ago. Of the aggregate output, 15,213 MBoe (or 87.3%) came from Wattenberg Field and the rest from Delaware Basin.
The average realized natural gas price increased from 76 cents per Mcf in the year-ago quarter to $1.98. PDC Energy sold NGLs at an average price of $20.11 per barrel compared with $6.38 a year ago. The average oil price realization came in at $65.05 per barrel, 249% higher than $18.63 in the year-ago period. Overall, the company fetched $30.6 per MBoe compared with $10.08 a year ago.
Capital Expenditure & Balance Sheet
The energy explorer shelled out $180 million in the form of oil and gas capital investments. As of Jun 30, 2021, PDC Energy had $109.7 million in cash and cash equivalents, and $1.24 billion as long-term debt, representing a debt-to-capitalization of 33.5%.
Guidance
The company expects to churn out 190,000-195,000 Boe per day in 2021. It reiterated its oil production guidance of 64,000-66,000 barrel per day. The company still expects to spend between $550 million and $600 million this year. It lifted its free cash flow (FCF) generation forecast to above $800 million (at a WTI price of $65, natural gas at $3.50 and NGL at $20) for 2021.
The energy player expects more than $200 million for third-quarter FCF, based on its updated commodity pricing projections. The company plans to spend roughly $150 million in the same period of 2021 to run a full-time drilling rig in each basin and a Wattenberg completion crew. It anticipates a 5-10% rise in total daily output and a 15-20% increase in daily oil production, sequentially.
By 2025, this Denver, CO-based energy player plans to reduce its GHG and methane emissions by 60% and 50%, respectively. The firm is now more committed to coordinate with the World Bank to achieve zero routine flaring by 2025, having preponed it 2030 as previously stated.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -6.11% due to these changes.
VGM Scores
At this time, PDC Energy has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, PDC Energy has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.