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NuStar Energy (NS) Stock Falls 10.2% Since Q4 Earnings Miss
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NuStar Energy L.P. stock has gone down 10.2% since the fourth-quarter 2021 earnings announcement on Feb 3.
This stock performance could be attributed to an earnings miss in the fourth quarter when NuStar's stock fell despite strong business performance and higher throughput volumes, backed by its refined products and crude oil pipelines. Moreover, production at the Permian Crude System hit record-breaking volumes.
Behind the Earnings Headlines
The oil pipeline operator, NuStar, reported fourth-quarter adjusted earnings per unit of 14 cents, less than the Zacks Consensus Estimate of 29 cents. The partnership’s bottom line was unfavorably impacted by higher costs associated with product sales, which rose 58% year over year to $116.6 million.
However, the bottom line was higher than the year-ago income of 13 cents per share, attributable to higher year-over-year revenues from the pipeline segment.
NuStar’s revenues of $417.4 million outpaced the Zacks Consensus Estimate of $407 million and increased almost 8% year over year.
It recorded an operating profit of $101.8 million compared with the profit of $104.4 million in the year-ago corresponding quarter. This small downside was due to an increase in general and administrative costs.
Segmental Updates
Pipeline: Total quarterly throughput volumes were 2,025,707 barrels per day (Bbl/d), up 22.2% from the year-ago period’s level of 1,657,310 Bbl/d. Throughput volumes from crude oil pipelines rose about 25% to 1,401,498 Bbl/d, while the throughput from refined product pipelines witnessed an increase to 624,209 Bbl/d from 535,932 Bbl/d.
NuStar's Permian Crude System throughput volumes also improved considerably to a record of 516,000 Bbl/d, up 23% from the year-ago quarter’s level. As a result, the segment’s revenues increased 12.76% year over year to $203.9 million. NS’ Pipeline unit reported an operating profit of $105.4 million, up from $85.6 million earned in the year-ago period.
Storage: Throughput volumes rose to 438,400 Bbl/d from 387,149 Bbl/d in the prior-year quarter. The unit’s quarterly revenues marginally fell 29.1% year over year to $91.7 million due to lower storage terminal revenues (from $92.9 million to $60 million) and also much lower throughput terminal revenues (from $36.5 million to $31.6 million). The segment’s operating profit came in at $26.9 million, down from the income of $49.1 million in the corresponding quarter of 2020, due to reduced revenues.
Fuels Marketing: Product sales increased to $121.8 million from $76.5 million in the year-ago quarter. Moreover, the cost of goods rose about 58% from the prior-year period to $116.1 million. The segment recorded operating earnings of $5.2 million in the quarter under review compared with earnings of $2.5 million in the fourth quarter of 2020.
NuStar Energy L.P. Price, Consensus and EPS Surprise
Fourth-quarter 2021 distributable cash flow available to limited partners was $63 million (providing 1.43X distribution coverage). A coverage ratio of more than 1 implies that NuStar is generating more than enough cash in the quarter to cover its distribution.
As of Dec 31, NS’ total consolidated debt was $3.17 billion.
NuStar anticipates generating full-year 2022 net income in the range of $242-$270 million and EBITDA between $700 million and $750 million.
For 2022, NuStar expects strategic capital spending of around $135 to $165 million.
Marathon Petroleum Corporation is a leading independent refiner, transporter and marketer of petroleum products. It reported fourth-quarter 2021 adjusted earnings of $1.30 per share, which comfortably beat the Zacks Consensus Estimate of 47 cents.
Marathon Petroleum is expected to see an earnings growth of 129.8% in 2022. As of Dec 31, MPC had cash and cash equivalents of $5.3 billion. Marathon Petroleum repurchased shares worth $3 billion in the October-January period and has now completed around 55% of its target to buy back $10 billion in common stock.
ConocoPhillips, based in Houston, TX, is primarily involved in the exploration and production of oil and natural gas. It recently reported fourth-quarter 2021 adjusted earnings per share of $2.27, comfortably beating the Zacks Consensus Estimate of $2.20.
ConocoPhillips’ earnings for 2022 are expected to soar 62.1% year over year. COP reported preliminary 2021 year-end proved reserves at 6.1 billion barrels of oil equivalent (Boe). As of Dec 31, 2021, ConocoPhillips had $5,028 million in total cash and cash equivalents.
Houston, TX-based Occidental Petroleum is an integrated oil and gas company with significant exploration and production exposure. As of the 2020 end, Occidental’s preliminary worldwide proved reserves totaled 2.91 billion Boe compared with 3.9 billion Boe at the 2019 end.
Occidental Petroleum’s earnings for 2022 are expected to surge 81.2% year over year. OXY witnessed five upward revisions in the past 30 days. It beat the Zacks Consensus Estimate thrice in the last four quarters and missed the same once, with an earnings surprise of 13.7%, on average.
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NuStar Energy (NS) Stock Falls 10.2% Since Q4 Earnings Miss
NuStar Energy L.P. stock has gone down 10.2% since the fourth-quarter 2021 earnings announcement on Feb 3.
This stock performance could be attributed to an earnings miss in the fourth quarter when NuStar's stock fell despite strong business performance and higher throughput volumes, backed by its refined products and crude oil pipelines. Moreover, production at the Permian Crude System hit record-breaking volumes.
Behind the Earnings Headlines
The oil pipeline operator, NuStar, reported fourth-quarter adjusted earnings per unit of 14 cents, less than the Zacks Consensus Estimate of 29 cents. The partnership’s bottom line was unfavorably impacted by higher costs associated with product sales, which rose 58% year over year to $116.6 million.
However, the bottom line was higher than the year-ago income of 13 cents per share, attributable to higher year-over-year revenues from the pipeline segment.
NuStar’s revenues of $417.4 million outpaced the Zacks Consensus Estimate of $407 million and increased almost 8% year over year.
It recorded an operating profit of $101.8 million compared with the profit of $104.4 million in the year-ago corresponding quarter. This small downside was due to an increase in general and administrative costs.
Segmental Updates
Pipeline: Total quarterly throughput volumes were 2,025,707 barrels per day (Bbl/d), up 22.2% from the year-ago period’s level of 1,657,310 Bbl/d. Throughput volumes from crude oil pipelines rose about 25% to 1,401,498 Bbl/d, while the throughput from refined product pipelines witnessed an increase to 624,209 Bbl/d from 535,932 Bbl/d.
NuStar's Permian Crude System throughput volumes also improved considerably to a record of 516,000 Bbl/d, up 23% from the year-ago quarter’s level. As a result, the segment’s revenues increased 12.76% year over year to $203.9 million. NS’ Pipeline unit reported an operating profit of $105.4 million, up from $85.6 million earned in the year-ago period.
Storage: Throughput volumes rose to 438,400 Bbl/d from 387,149 Bbl/d in the prior-year quarter. The unit’s quarterly revenues marginally fell 29.1% year over year to $91.7 million due to lower storage terminal revenues (from $92.9 million to $60 million) and also much lower throughput terminal revenues (from $36.5 million to $31.6 million). The segment’s operating profit came in at $26.9 million, down from the income of $49.1 million in the corresponding quarter of 2020, due to reduced revenues.
Fuels Marketing: Product sales increased to $121.8 million from $76.5 million in the year-ago quarter. Moreover, the cost of goods rose about 58% from the prior-year period to $116.1 million. The segment recorded operating earnings of $5.2 million in the quarter under review compared with earnings of $2.5 million in the fourth quarter of 2020.
NuStar Energy L.P. Price, Consensus and EPS Surprise
NuStar Energy L.P. price-consensus-eps-surprise-chart | NuStar Energy L.P. Quote
Cash Flow, Debt and Guidance
Fourth-quarter 2021 distributable cash flow available to limited partners was $63 million (providing 1.43X distribution coverage). A coverage ratio of more than 1 implies that NuStar is generating more than enough cash in the quarter to cover its distribution.
As of Dec 31, NS’ total consolidated debt was $3.17 billion.
NuStar anticipates generating full-year 2022 net income in the range of $242-$270 million and EBITDA between $700 million and $750 million.
For 2022, NuStar expects strategic capital spending of around $135 to $165 million.
Zacks Rank & Stocks to Consider
NuStar currently carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy space include Marathon Petroleum Corporation (MPC - Free Report) , ConocoPhillips (COP - Free Report) and Occidental Petroleum (OXY - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Marathon Petroleum Corporation is a leading independent refiner, transporter and marketer of petroleum products. It reported fourth-quarter 2021 adjusted earnings of $1.30 per share, which comfortably beat the Zacks Consensus Estimate of 47 cents.
Marathon Petroleum is expected to see an earnings growth of 129.8% in 2022. As of Dec 31, MPC had cash and cash equivalents of $5.3 billion. Marathon Petroleum repurchased shares worth $3 billion in the October-January period and has now completed around 55% of its target to buy back $10 billion in common stock.
ConocoPhillips, based in Houston, TX, is primarily involved in the exploration and production of oil and natural gas. It recently reported fourth-quarter 2021 adjusted earnings per share of $2.27, comfortably beating the Zacks Consensus Estimate of $2.20.
ConocoPhillips’ earnings for 2022 are expected to soar 62.1% year over year. COP reported preliminary 2021 year-end proved reserves at 6.1 billion barrels of oil equivalent (Boe). As of Dec 31, 2021, ConocoPhillips had $5,028 million in total cash and cash equivalents.
Houston, TX-based Occidental Petroleum is an integrated oil and gas company with significant exploration and production exposure. As of the 2020 end, Occidental’s preliminary worldwide proved reserves totaled 2.91 billion Boe compared with 3.9 billion Boe at the 2019 end.
Occidental Petroleum’s earnings for 2022 are expected to surge 81.2% year over year. OXY witnessed five upward revisions in the past 30 days. It beat the Zacks Consensus Estimate thrice in the last four quarters and missed the same once, with an earnings surprise of 13.7%, on average.