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Why Is Plains All American (PAA) Up 7.4% Since Last Earnings Report?
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It has been about a month since the last earnings report for Plains All American Pipeline (PAA - Free Report) . Shares have added about 7.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Plains All American due for a pullback? 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 drivers.
Plains All American Q1 Earnings Miss, Revenues Beat
Plains All American Pipeline, L.P. reported first-quarter 2022 adjusted earnings of 31 cents per unit, which lagged the Zacks Consensus Estimate of 37 cents by 16.2%. The bottom line improved 24% from the year-ago figure.
For the quarter under review, the partnership reported GAAP earnings of 19 cents per unit compared with 51 cents in the year-ago period.
Total Revenues
Total revenues of $13,694 million surpassed the Zacks Consensus Estimate of $11,668 million by 17.4%. The top line improved 63.2% from $8,393 million reported a year ago. Strong performance of its Crude Oil and Natural Gas Liquids (“NGL”) segment boosted the top line.
Highlights of the Release
For the quarter under review, Plains All American’s total costs and expenses were $13,401 million, up 70.6% year over year. This increase was primarily due to higher purchases and related costs.
Total adjusted EBITDA for the quarter was $614 million, up 13.1% from the year-ago period.
During the quarter, Crude Oil volumes were 7,159 thousand barrels per day (Mbls/d) and NGL sales volume was 168 Mbls/d.
Net interest expenses were $107 million, flat with the year-ago quarter.
The firm reduced its long-term debt level by $412 million during first-quarter 2022, which will lower capital servicing costs.
Segmental Performance
The Crude Oil segment’s adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $453 million compared with $474 million in the year-ago quarter. The performance of this segment was impacted by the sale of its natural gas storage facilities in August of 2021 and gains related to hedged power costs resulting from Winter Storm Uri, recognized in the first quarter of 2021.
The NGL Segment’s adjusted EBITDA was $161 million compared with $69 million in the year-ago quarter. The performance of this segment was driven by the favorable impact of higher realized fractionation spreads and higher NGL sales prices, partially offset by lower NGL sales volumes.
Financial Update
As of Mar 31, 2022, current assets were $8,097 million compared with $6,137 million as of Dec 31, 2021.
As of Mar 31, 2022, Plains All American had long-term debt of $7,986 million compared with $8,398 million as of Dec 31, 2021. Free cash flow was $200 million compared with $678 million in the year-ago period.
As of the same date, its long-term debt-to-total book capitalization was 44%, down from 46% as of Dec 31, 2021.
Guidance
Plains All American now expects 2022 adjusted EBITDA to be $2,275 million, up from the previous expectation of $2,200 million. Free cash flow for 2022 is expected to be $1,250 million.
Plains All Pipeline expects Crude pipeline volumes to average 7,330 Mbls/d (up from previous guidance of 7,150 Mbls/d) and NGL sales volume to be 140 Mbls/d in 2022. The firm plans to invest $550 million in 2022 to strengthen operations.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -12.5% due to these changes.
VGM Scores
At this time, Plains All American has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Plains All American has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Plains All American belongs to the Zacks Oil and Gas - Production Pipeline - MLB industry. Another stock from the same industry, Oneok Inc. (OKE - Free Report) , has gained 5.3% over the past month. More than a month has passed since the company reported results for the quarter ended March 2022.
Oneok reported revenues of $5.44 billion in the last reported quarter, representing a year-over-year change of +70.4%. EPS of $0.87 for the same period compares with $0.86 a year ago.
For the current quarter, Oneok is expected to post earnings of $0.93 per share, indicating a change of +20.8% from the year-ago quarter. The Zacks Consensus Estimate has changed -2.3% over the last 30 days.
Oneok has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.
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Why Is Plains All American (PAA) Up 7.4% Since Last Earnings Report?
It has been about a month since the last earnings report for Plains All American Pipeline (PAA - Free Report) . Shares have added about 7.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Plains All American due for a pullback? 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 drivers.
Plains All American Q1 Earnings Miss, Revenues Beat
Plains All American Pipeline, L.P. reported first-quarter 2022 adjusted earnings of 31 cents per unit, which lagged the Zacks Consensus Estimate of 37 cents by 16.2%. The bottom line improved 24% from the year-ago figure.
For the quarter under review, the partnership reported GAAP earnings of 19 cents per unit compared with 51 cents in the year-ago period.
Total Revenues
Total revenues of $13,694 million surpassed the Zacks Consensus Estimate of $11,668 million by 17.4%. The top line improved 63.2% from $8,393 million reported a year ago. Strong performance of its Crude Oil and Natural Gas Liquids (“NGL”) segment boosted the top line.
Highlights of the Release
For the quarter under review, Plains All American’s total costs and expenses were $13,401 million, up 70.6% year over year. This increase was primarily due to higher purchases and related costs.
Total adjusted EBITDA for the quarter was $614 million, up 13.1% from the year-ago period.
During the quarter, Crude Oil volumes were 7,159 thousand barrels per day (Mbls/d) and NGL sales volume was 168 Mbls/d.
Net interest expenses were $107 million, flat with the year-ago quarter.
The firm reduced its long-term debt level by $412 million during first-quarter 2022, which will lower capital servicing costs.
Segmental Performance
The Crude Oil segment’s adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $453 million compared with $474 million in the year-ago quarter. The performance of this segment was impacted by the sale of its natural gas storage facilities in August of 2021 and gains related to hedged power costs resulting from Winter Storm Uri, recognized in the first quarter of 2021.
The NGL Segment’s adjusted EBITDA was $161 million compared with $69 million in the year-ago quarter. The performance of this segment was driven by the favorable impact of higher realized fractionation spreads and higher NGL sales prices, partially offset by lower NGL sales volumes.
Financial Update
As of Mar 31, 2022, current assets were $8,097 million compared with $6,137 million as of Dec 31, 2021.
As of Mar 31, 2022, Plains All American had long-term debt of $7,986 million compared with $8,398 million as of Dec 31, 2021. Free cash flow was $200 million compared with $678 million in the year-ago period.
As of the same date, its long-term debt-to-total book capitalization was 44%, down from 46% as of Dec 31, 2021.
Guidance
Plains All American now expects 2022 adjusted EBITDA to be $2,275 million, up from the previous expectation of $2,200 million. Free cash flow for 2022 is expected to be $1,250 million.
Plains All Pipeline expects Crude pipeline volumes to average 7,330 Mbls/d (up from previous guidance of 7,150 Mbls/d) and NGL sales volume to be 140 Mbls/d in 2022. The firm plans to invest $550 million in 2022 to strengthen operations.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -12.5% due to these changes.
VGM Scores
At this time, Plains All American has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Plains All American has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Plains All American belongs to the Zacks Oil and Gas - Production Pipeline - MLB industry. Another stock from the same industry, Oneok Inc. (OKE - Free Report) , has gained 5.3% over the past month. More than a month has passed since the company reported results for the quarter ended March 2022.
Oneok reported revenues of $5.44 billion in the last reported quarter, representing a year-over-year change of +70.4%. EPS of $0.87 for the same period compares with $0.86 a year ago.
For the current quarter, Oneok is expected to post earnings of $0.93 per share, indicating a change of +20.8% from the year-ago quarter. The Zacks Consensus Estimate has changed -2.3% over the last 30 days.
Oneok has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.