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Enterprise's (EPD) Q3 Earnings & Revenues Beat Estimates

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Enterprise Products Partners LP (EPD - Free Report) reported third-quarter 2022 adjusted earnings per limited partner unit of 63 cents, beating the Zacks Consensus Estimate of 61 cents. The bottom line improved from the year-ago quarter’s 52 cents per share.

Total quarterly revenues of $15,468 million surpassed the Zacks Consensus Estimate of $13,847 million. The top line significantly increased from $10,831 million in the prior-year quarter.

The strong results were driven by higher contributions from the NGL Pipelines & Services business.

Segmental Performance

Pipeline volumes in NGL, crude oil, refined products and petrochemicals were recorded at 6.7 million barrels per day (bpd), slightly higher than the year-ago quarter’s 6.3 million bpd. Natural gas pipeline volumes were 17.5 trillion British thermal units per day (TBtus/d), up from 14.6 TBtus/d a year ago. Also, marine terminal volumes increased to 1.7 million bpd from 1.5 million bpd.

Gross operating income at NGL Pipelines & Services increased from $1,023 million in the year-ago quarter to $1,296 million, primarily due to higher NGL pipeline transportation volumes.

Natural Gas Pipelines and Services’ gross operating income increased to $278 million from $223 million in the year-ago quarter. The upside was due to an increase in natural gas pipeline transportation volumes.

Crude Oil Pipelines & Services recorded a gross operating income of $415 million, which decreased from $423 million in the prior-year quarter.

Gross operating income at Petrochemical & Refined Products Services amounted to $353 million compared with $411 million a year ago, primarily due to lower gross operating margin from propylene production and related activities.

Cash Flow

Adjusted distributable cash flow was $1,868 million, up from $1,613 million a year ago, and provided coverage of 1.8X. The partnership retained $826 million of distributable cash flow in the September quarter. It generated an adjusted free cash flow of $1,476 million compared with $1,191 million in the year-ago quarter.

Financials

For third-quarter 2022, Enterprise’s total capital investment was $474 million.

As of Sep 30, 2022, its outstanding total debt principal was $29.5 billion. Enterprise’s consolidated liquidity amounted to $3.3 billion. The total liquidity amount included unrestricted cash on hand and available borrowing capacity under its revolving credit facility.

Zacks Rank & Stocks to Consider

Enterprise currently carries a Zacks Rank #4 (Sell). Better-ranked players in the same space include Magellan Midstream Partners , EQT Corporation (EQT - Free Report) and Shell plc (SHEL - Free Report) . All the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Being a midstream energy player, Magellan Midstream’s business model is less exposed to volatility in oil and gas prices. In fact, contributions from core fee-based transportation and terminals activities have aided MMP’s results in the third quarter of this year.

In the core of gas-rich Marcellus and Utica Shales, EQT Corporation has a strong foothold. Being a leading producer of natural gas, EQT is benefiting from high natural gas prices. For 2022, it is likely to witness earnings growth of 369.6%.

Being a leading player in liquefied natural gas across the globe, Shell’s business prospects seem bright. In the energy transition front, it is playing a crucial role, setting an ambitious goal of becoming a net-zero-emissions energy business by 2050 or before. For 2022, SHEL is likely to see earnings growth of almost 115%.


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