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Range Resources (RRC) Q4 Earnings Lag Estimates, Revenues Top
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Range Resources Corporation (RRC - Free Report) reported fourth-quarter 2021 adjusted earnings of 96 cents per share, missing the Zacks Consensus Estimate of 98 cents. The bottom line improved from earnings of 2 cents per share in the prior-year quarter.
Total revenues for the reported quarter were $1,567 million, beating the Zacks Consensus Estimate of $967 million. The top line improved from the prior-year $599 million.
The lower-than-expected quarterly earnings were owing to increased direct operating expenses. This was offset partially by higher gas equivalent production.
Operational Performance
For fourth-quarter 2021, the company’s production averaged 2,198.4 million cubic feet equivalent per day, up 5% from the prior-year period. Natural gas contributed almost 70% to total production, while NGLs and oil accounted for the remaining.
Oil production increased 36% for the quarter from the year-ago period, while NGL and natural gas output increased 5%.
Its total price realization (excluding derivative settlements and before third-party transportation costs) averaged $5.64 per thousand cubic feet equivalent (Mcfe), up 143% year over year. Natural gas prices rose 169% on a year-over-year basis to $5.27 per Mcf. NGL and oil prices increased 101% and 120%, respectively.
Costs & Expenses
Total costs and expenses rose to $656.9 million from $556.3 million in the year-ago quarter. Total transportation, gathering, processing and compression costs as well as direct operating expenses increased in the quarter. Lower exploration costs offset the rise of the expenses partially.
On a per-unit basis, direct operating costs increased to 9 cents per Mcfe from 8 cents per Mcfe in the December quarter of 2020. Transportation, gathering, processing and compression expenses were recorded at $1.59 per Mcfe, higher than $1.34 in the prior-year quarter.
Capital Expenditure & Balance Sheet
The company’s drilling and completion expenditure totaled $83.7 million for fourth-quarter 2021. An amount of $8.6 million was used in acreage and gathering facilities.
At fourth quarter-end, it had total debt of $2,707.8 million. It had a debt to capitalization of 56.5%.
Outlook
Range Resources has reinstated its regular quarterly cash dividend, expected to start in the second half of this year. Range Resources anticipated its annual dividend rate at 32 cents per share.
RRC has announced the authorization of a $500-million share repurchase program. The upstream energy firm has projected free cash flow to exceed $1 billion this year.
RRC anticipates capital spending for this year in the band of $460 million to $480 million.
Zacks Rank & Stock to Consider
Range Resources carries a Zacks Rank #3 (Hold). A few better-ranked players in the energy space include Exxon Mobil Corporation (XOM - Free Report) , ConocoPhillips (COP - Free Report) and Chevron Corporation (CVX - Free Report) CVXCVX). While ExxonMobil and ConocoPhillips sport a Zacks Rank #1 (Strong Buy), Chevron carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ExxonMobil is banking on its key upstream projects that are centered around Permian – the most prolific basing in the United States – and offshore Guyana resources.
ExxonMobil reported strong fourth-quarter results, thanks to improved realized oil and natural gas prices as well as higher refining and chemical margins. In the past seven days, ExxonMobil has witnessed upward earnings estimate revisions for 2022.
Considering production and proved reserves, ConocoPhillips is one of the leading upstream energy players. In the past 30 days, ConocoPhillips has witnessed upward earnings estimate revisions in the past 30 days.
ConocoPhillips’ estimate for earnings for 2022 are pegged at $9.74 per share, suggesting a year-over-year increase of 62.1%.
In the Permian basin, Chevron has a strong footprint. The majority of Chevron’s assets in the most prolific basin of the United States has minimal royal payments, thereby securing handsome cashflows in the long run.
In the past 30 days, Chevron has witnessed upward earnings estimate revisions for 2022.
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Range Resources (RRC) Q4 Earnings Lag Estimates, Revenues Top
Range Resources Corporation (RRC - Free Report) reported fourth-quarter 2021 adjusted earnings of 96 cents per share, missing the Zacks Consensus Estimate of 98 cents. The bottom line improved from earnings of 2 cents per share in the prior-year quarter.
Total revenues for the reported quarter were $1,567 million, beating the Zacks Consensus Estimate of $967 million. The top line improved from the prior-year $599 million.
The lower-than-expected quarterly earnings were owing to increased direct operating expenses. This was offset partially by higher gas equivalent production.
Operational Performance
For fourth-quarter 2021, the company’s production averaged 2,198.4 million cubic feet equivalent per day, up 5% from the prior-year period. Natural gas contributed almost 70% to total production, while NGLs and oil accounted for the remaining.
Oil production increased 36% for the quarter from the year-ago period, while NGL and natural gas output increased 5%.
Its total price realization (excluding derivative settlements and before third-party transportation costs) averaged $5.64 per thousand cubic feet equivalent (Mcfe), up 143% year over year. Natural gas prices rose 169% on a year-over-year basis to $5.27 per Mcf. NGL and oil prices increased 101% and 120%, respectively.
Costs & Expenses
Total costs and expenses rose to $656.9 million from $556.3 million in the year-ago quarter. Total transportation, gathering, processing and compression costs as well as direct operating expenses increased in the quarter. Lower exploration costs offset the rise of the expenses partially.
On a per-unit basis, direct operating costs increased to 9 cents per Mcfe from 8 cents per Mcfe in the December quarter of 2020. Transportation, gathering, processing and compression expenses were recorded at $1.59 per Mcfe, higher than $1.34 in the prior-year quarter.
Capital Expenditure & Balance Sheet
The company’s drilling and completion expenditure totaled $83.7 million for fourth-quarter 2021. An amount of $8.6 million was used in acreage and gathering facilities.
At fourth quarter-end, it had total debt of $2,707.8 million. It had a debt to capitalization of 56.5%.
Outlook
Range Resources has reinstated its regular quarterly cash dividend, expected to start in the second half of this year. Range Resources anticipated its annual dividend rate at 32 cents per share.
RRC has announced the authorization of a $500-million share repurchase program. The upstream energy firm has projected free cash flow to exceed $1 billion this year.
RRC anticipates capital spending for this year in the band of $460 million to $480 million.
Zacks Rank & Stock to Consider
Range Resources carries a Zacks Rank #3 (Hold). A few better-ranked players in the energy space include Exxon Mobil Corporation (XOM - Free Report) , ConocoPhillips (COP - Free Report) and Chevron Corporation (CVX - Free Report) CVXCVX). While ExxonMobil and ConocoPhillips sport a Zacks Rank #1 (Strong Buy), Chevron carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ExxonMobil is banking on its key upstream projects that are centered around Permian – the most prolific basing in the United States – and offshore Guyana resources.
ExxonMobil reported strong fourth-quarter results, thanks to improved realized oil and natural gas prices as well as higher refining and chemical margins. In the past seven days, ExxonMobil has witnessed upward earnings estimate revisions for 2022.
Considering production and proved reserves, ConocoPhillips is one of the leading upstream energy players. In the past 30 days, ConocoPhillips has witnessed upward earnings estimate revisions in the past 30 days.
ConocoPhillips’ estimate for earnings for 2022 are pegged at $9.74 per share, suggesting a year-over-year increase of 62.1%.
In the Permian basin, Chevron has a strong footprint. The majority of Chevron’s assets in the most prolific basin of the United States has minimal royal payments, thereby securing handsome cashflows in the long run.
In the past 30 days, Chevron has witnessed upward earnings estimate revisions for 2022.