A month has gone by since the last earnings report for PDC Energy . Shares have lost about 11.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is PDC Energy due for a breakout? 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 catalysts.
PDC Energy Q3 Earnings and Revenues Beat Estimates
PDC Energy reported adjusted earnings per share of $2.33, comfortably ahead of the Zacks Consensus Estimate of $1.45. The company had reported a profit of $1.04 in the year-ago quarter. The outperformance can be primarily attributed to better-than-anticipated production volumes and higher commodity prices. Precisely, the Colorado-focused company’s output of 18,764 thousand barrels of oil equivalent (MBoe) surpassed the Zacks Consensus Estimate of 18,217 MBoe.
Meanwhile, PDC Energy recorded oil and gas sales of $703.1 million, ahead of the consensus mark by 24.5% and came in significantly higher than the year-ago level of $314.9 million.
Production & Prices
For the third quarter of 2021, PDC Energy’s production totaled 18,764 MBoe (60% liquids), reflecting an increase of 6% from 17,701 MBoe a year ago. Of the aggregate output, 16,047 MBoe (or some 86%) came from Wattenberg Field and the rest from Delaware Basin.
The average realized natural gas price increased from $1 per thousand cubic feet (Mcf) in the year-ago quarter to $3. PDC Energy sold NGLs at an average price of $28.33 per barrels (Bbls) compared to $9.97 a year ago. Meanwhile, the average oil price realization came in at $69.17 per barrel, 84.5% higher than $37.49 in the year-ago period. Overall, PDC Energy fetched $37.47 per MBoe compared with $17.79 a year ago.
Capital Expenditure & Balance Sheet
The energy explorer shelled out $149 million in the form of oil and gas capital investments. As of Sep 30, PDC Energy had approximately $99.9 million in cash and cash equivalents, and $1.2 billion in long-term debt, representing a debt-to-capitalization of 32.8%. During the quarter, the company bought back shares worth $60 million.
Guidance
PDC Energy still expects to churn out 190,000-195,000 Boe per day in 2021. It also reiterated its oil production guidance of 60,000-63,000 Bbls per day. Further, the company expects this year’s capital spending at the high end of the guidance range of $550-$$600 million and plans to generate free cash flow in excess of $900 million (at a WTI price of $75, natural gas at $5 and NGL at $30). The company believes it can produce 200,000-205,000 Boe per day in the fourth quarter, with oil constituting 66,000-69,000 Bbls per day.
As PDC Energy continues to generate free cash flows, it has committed to return a minimum of $210 million to shareholders in 2021, up from the previous target of $180 million. In the December quarter, the company plans to reward investors with $80 million through dividends (fixed and possibly even special) and buybacks.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 15.19% due to these changes.
VGM Scores
Currently, PDC Energy has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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 upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise PDC Energy has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Image: Bigstock
PDC Energy (PDCE) Down 11.4% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for PDC Energy . Shares have lost about 11.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is PDC Energy due for a breakout? 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 catalysts.
PDC Energy Q3 Earnings and Revenues Beat Estimates
PDC Energy reported adjusted earnings per share of $2.33, comfortably ahead of the Zacks Consensus Estimate of $1.45. The company had reported a profit of $1.04 in the year-ago quarter. The outperformance can be primarily attributed to better-than-anticipated production volumes and higher commodity prices. Precisely, the Colorado-focused company’s output of 18,764 thousand barrels of oil equivalent (MBoe) surpassed the Zacks Consensus Estimate of 18,217 MBoe.
Meanwhile, PDC Energy recorded oil and gas sales of $703.1 million, ahead of the consensus mark by 24.5% and came in significantly higher than the year-ago level of $314.9 million.
Production & Prices
For the third quarter of 2021, PDC Energy’s production totaled 18,764 MBoe (60% liquids), reflecting an increase of 6% from 17,701 MBoe a year ago. Of the aggregate output, 16,047 MBoe (or some 86%) came from Wattenberg Field and the rest from Delaware Basin.
The average realized natural gas price increased from $1 per thousand cubic feet (Mcf) in the year-ago quarter to $3. PDC Energy sold NGLs at an average price of $28.33 per barrels (Bbls) compared to $9.97 a year ago. Meanwhile, the average oil price realization came in at $69.17 per barrel, 84.5% higher than $37.49 in the year-ago period. Overall, PDC Energy fetched $37.47 per MBoe compared with $17.79 a year ago.
Capital Expenditure & Balance Sheet
The energy explorer shelled out $149 million in the form of oil and gas capital investments. As of Sep 30, PDC Energy had approximately $99.9 million in cash and cash equivalents, and $1.2 billion in long-term debt, representing a debt-to-capitalization of 32.8%. During the quarter, the company bought back shares worth $60 million.
Guidance
PDC Energy still expects to churn out 190,000-195,000 Boe per day in 2021. It also reiterated its oil production guidance of 60,000-63,000 Bbls per day. Further, the company expects this year’s capital spending at the high end of the guidance range of $550-$$600 million and plans to generate free cash flow in excess of $900 million (at a WTI price of $75, natural gas at $5 and NGL at $30). The company believes it can produce 200,000-205,000 Boe per day in the fourth quarter, with oil constituting 66,000-69,000 Bbls per day.
As PDC Energy continues to generate free cash flows, it has committed to return a minimum of $210 million to shareholders in 2021, up from the previous target of $180 million. In the December quarter, the company plans to reward investors with $80 million through dividends (fixed and possibly even special) and buybacks.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 15.19% due to these changes.
VGM Scores
Currently, PDC Energy has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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 upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise PDC Energy has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.