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EQT (EQT) Down 5.7% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for EQT Corporation (EQT - Free Report) . Shares have lost about 5.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is EQT due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
EQT Q2 Earnings Beat Estimates on Strong Sales, Lower Expenses
EQT Corporation reported a second-quarter 2024 adjusted loss from continuing operations of 8 cents per share, which beat the Zacks Consensus Estimate of a loss of 20 cents. The bottom line was narrower than the year-ago quarter’s reported loss of 17 cents.
Adjusted operating revenues increased to $1.18 billion from $993 million in the prior-year quarter. The top line also beat the Zacks Consensus Estimate of $1.14 billion.
The strong quarterly results were driven by higher sales volume and lower total operating expenses.
Production
Sales volume increased to 508 billion cubic feet equivalent (Bcfe) from the year-ago quarter’s level of 471 Bcfe. The reported figure also beat our estimate of 499.2 Bcfe.
Natural gas sales volume was 474.1 Bcf, up from 449.7 Bcf in the year-ago quarter. The figure also beat our estimate of 470.9 Bcf.
The total liquid sales volume was 5,573 thousand barrels (MBbls), up from the year-ago period’s level of 3,530 MBbls. The figure also exceeded our projection of 4,703.6 MBbls.
Commodity Price Realizations
The average realized price was $2.33 per thousand cubic feet of natural gas equivalent (Mcfe), up from the year-ago quarter’s level of $2.11 per Mcfe.
The average natural gas price, including cash-settled derivatives, was $2.16 per Mcf, which increased year over year from $2.03.
The natural gas sales price was $2.02 per Mcf, lower than the year-ago quarter’s reported number of $2.20.
However, oil price was $61.96 per barrel compared with the year-ago quarter’s figure of $49.71, and our estimate for the same was pinned at $60.69.
Expenses
Total operating expenses were $949.5 million in the second quarter, lower than $1.05 billion reported in the prior-year quarter. The reported figure also came in lower than our estimate of $1.51 billion.
However, transmission expenses totaled 35 cents per Mcfe, up from the year-ago quarter’s level of 33 cents. Lease operating expenses amounted to 12 cents, up from the prior-year quarter’s figure of 8 cents.
Cash Flows
EQT’s adjusted operating cash flow totaled $405.04 million in the quarter, up from $340.79 million reported a year ago. The negative free cash flow in the quarter totaled $171.1 million, up from $129.3 million in the year-ago period.
Capex & Balance Sheet
Total capital expenditure was $576 million, up from $470 million reported a year ago.
As of Jun 30, 2024, the company had cash and cash equivalents of $29.9 million, and net debt worth $4.92 billion.
Guidance
For 2024, total sales volume is expected to be in the range of 2,100-2,200 Bcfe, indicating an increase from 2,016 Bcfe reported in 2023.
For the third quarter of 2024, EQT anticipates total sales volume and liquids sales volume (excluding ethane) to be in the band of 510-560 Bcfe and 3,600-3,900 Mbbl, respectively. In the fourth quarter, total sales volume is expected to be in the 515-565 Bcfe range, with liquids sales volume of 4,000-4,300 Mbbl.
The company forecasts per-unit operating costs of $1.12-$1.26 per Mcfe for the third quarter and $1.11-$1.25 per Mcfe for the fourth. Capital expenditures are projected to be in the band of $620-$720 million and $580-$680 million for the third and fourth quarter, respectively.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 9.05% due to these changes.
VGM Scores
Currently, EQT has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, 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 C. 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. Notably, EQT has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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EQT (EQT) Down 5.7% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for EQT Corporation (EQT - Free Report) . Shares have lost about 5.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is EQT due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
EQT Q2 Earnings Beat Estimates on Strong Sales, Lower Expenses
EQT Corporation reported a second-quarter 2024 adjusted loss from continuing operations of 8 cents per share, which beat the Zacks Consensus Estimate of a loss of 20 cents. The bottom line was narrower than the year-ago quarter’s reported loss of 17 cents.
Adjusted operating revenues increased to $1.18 billion from $993 million in the prior-year quarter. The top line also beat the Zacks Consensus Estimate of $1.14 billion.
The strong quarterly results were driven by higher sales volume and lower total operating expenses.
Production
Sales volume increased to 508 billion cubic feet equivalent (Bcfe) from the year-ago quarter’s level of 471 Bcfe. The reported figure also beat our estimate of 499.2 Bcfe.
Natural gas sales volume was 474.1 Bcf, up from 449.7 Bcf in the year-ago quarter. The figure also beat our estimate of 470.9 Bcf.
The total liquid sales volume was 5,573 thousand barrels (MBbls), up from the year-ago period’s level of 3,530 MBbls. The figure also exceeded our projection of 4,703.6 MBbls.
Commodity Price Realizations
The average realized price was $2.33 per thousand cubic feet of natural gas equivalent (Mcfe), up from the year-ago quarter’s level of $2.11 per Mcfe.
The average natural gas price, including cash-settled derivatives, was $2.16 per Mcf, which increased year over year from $2.03.
The natural gas sales price was $2.02 per Mcf, lower than the year-ago quarter’s reported number of $2.20.
However, oil price was $61.96 per barrel compared with the year-ago quarter’s figure of $49.71, and our estimate for the same was pinned at $60.69.
Expenses
Total operating expenses were $949.5 million in the second quarter, lower than $1.05 billion reported in the prior-year quarter. The reported figure also came in lower than our estimate of $1.51 billion.
However, transmission expenses totaled 35 cents per Mcfe, up from the year-ago quarter’s level of 33 cents. Lease operating expenses amounted to 12 cents, up from the prior-year quarter’s figure of 8 cents.
Cash Flows
EQT’s adjusted operating cash flow totaled $405.04 million in the quarter, up from $340.79 million reported a year ago. The negative free cash flow in the quarter totaled $171.1 million, up from $129.3 million in the year-ago period.
Capex & Balance Sheet
Total capital expenditure was $576 million, up from $470 million reported a year ago.
As of Jun 30, 2024, the company had cash and cash equivalents of $29.9 million, and net debt worth $4.92 billion.
Guidance
For 2024, total sales volume is expected to be in the range of 2,100-2,200 Bcfe, indicating an increase from 2,016 Bcfe reported in 2023.
For the third quarter of 2024, EQT anticipates total sales volume and liquids sales volume (excluding ethane) to be in the band of 510-560 Bcfe and 3,600-3,900 Mbbl, respectively. In the fourth quarter, total sales volume is expected to be in the 515-565 Bcfe range, with liquids sales volume of 4,000-4,300 Mbbl.
The company forecasts per-unit operating costs of $1.12-$1.26 per Mcfe for the third quarter and $1.11-$1.25 per Mcfe for the fourth. Capital expenditures are projected to be in the band of $620-$720 million and $580-$680 million for the third and fourth quarter, respectively.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 9.05% due to these changes.
VGM Scores
Currently, EQT has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, 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 C. 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. Notably, EQT has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.