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Why Is Northern Oil and Gas (NOG) Down 6% Since Last Earnings Report?
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It has been about a month since the last earnings report for Northern Oil and Gas (NOG - Free Report) . Shares have lost about 6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Northern Oil and Gas due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Northern Oil and Gas reported third-quarter 2022 adjusted earnings per share (EPS) of $1.80, beating the Zacks Consensus Estimate of $1.70, primarily attributable to greater net production and continued high commodity prices. Moreover, the bottom line improved considerably from the year-ago profit of 84 cents.
The company's oil and natural gas sales of $534 million beat the Zacks Consensus Estimate of $413 million. The top line also skyrocketed from the year-ago figure of $259.7 million.
In good news for investors, Northern Oil instituted a 20% dividend hike compared with the previous quarter. It declared a regular quarterly cash dividend for NOG’s common stock of 30 cents per share, payable on Jan 31, 2023, to stockholders of record as of the close of the business on Dec 29, 2022. Its adjusted EBITDA rose about 7% sequentially to $292.4 million.
Production & Price Realizations
The third-quarter production (comprising 57% oil) surged about 37.2% from the year-ago level to 79,123 barrels of oil equivalent per day (Boe/d) and surpassed the Zacks Consensus Estimate of 76,579 Boe/d. While the oil volume came in at 45,107 barrels per day (up 32.5% year over year), natural gas totaled 294,096 thousand cubic feet per day (up 44%).
The average sales price for crude oil in the third quarter was $90.54 per barrel, reflecting a 39.5% hike from the prior-year realization of $64.91. The average realized natural gas price was $8.43 per thousand cubic feet compared with $4.33 in the year-earlier period.
Financial Position
Excluding working capital, cash flow from operations jumped roughly 7% from the last quarter’s figure to $269.3 million, while Northern Oil's organic drilling and development capital expenditure totaled $136.6 million. The company's free cash flow for the quarter was $110.6 million.
As of Sep 30, the owner of non-operating, minority interests in thousands of oil and gas wells had $9.13 million in cash and cash equivalents. The company had long-term debt of around $1.17 billion.
Guidance
Northern Oil's output for 2022 is now anticipated in the 74,500-78,000 Boe/d range compared with the previous guidance in the band of 73,000-77,000 Boe/d.
NOG updated its total capital spending guidance for 2022 from the $405-$470 million range to the $460-$510 million band.
Moreover, the company also updated this year's oil-mix guidance from the 59.5-61.5% range to the 59-60.5% range.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
At this time, Northern Oil and Gas has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. Charting a somewhat similar path, 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 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 these revisions indicates a downward shift. Notably, Northern Oil and Gas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Northern Oil and Gas (NOG) Down 6% Since Last Earnings Report?
It has been about a month since the last earnings report for Northern Oil and Gas (NOG - Free Report) . Shares have lost about 6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Northern Oil and Gas due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Northern Oil Q3 Earnings & Sales Outperform Estimates
Northern Oil and Gas reported third-quarter 2022 adjusted earnings per share (EPS) of $1.80, beating the Zacks Consensus Estimate of $1.70, primarily attributable to greater net production and continued high commodity prices. Moreover, the bottom line improved considerably from the year-ago profit of 84 cents.
The company's oil and natural gas sales of $534 million beat the Zacks Consensus Estimate of $413 million. The top line also skyrocketed from the year-ago figure of $259.7 million.
In good news for investors, Northern Oil instituted a 20% dividend hike compared with the previous quarter. It declared a regular quarterly cash dividend for NOG’s common stock of 30 cents per share, payable on Jan 31, 2023, to stockholders of record as of the close of the business on Dec 29, 2022. Its adjusted EBITDA rose about 7% sequentially to $292.4 million.
Production & Price Realizations
The third-quarter production (comprising 57% oil) surged about 37.2% from the year-ago level to 79,123 barrels of oil equivalent per day (Boe/d) and surpassed the Zacks Consensus Estimate of 76,579 Boe/d. While the oil volume came in at 45,107 barrels per day (up 32.5% year over year), natural gas totaled 294,096 thousand cubic feet per day (up 44%).
The average sales price for crude oil in the third quarter was $90.54 per barrel, reflecting a 39.5% hike from the prior-year realization of $64.91. The average realized natural gas price was $8.43 per thousand cubic feet compared with $4.33 in the year-earlier period.
Financial Position
Excluding working capital, cash flow from operations jumped roughly 7% from the last quarter’s figure to $269.3 million, while Northern Oil's organic drilling and development capital expenditure totaled $136.6 million. The company's free cash flow for the quarter was $110.6 million.
As of Sep 30, the owner of non-operating, minority interests in thousands of oil and gas wells had $9.13 million in cash and cash equivalents. The company had long-term debt of around $1.17 billion.
Guidance
Northern Oil's output for 2022 is now anticipated in the 74,500-78,000 Boe/d range compared with the previous guidance in the band of 73,000-77,000 Boe/d.
NOG updated its total capital spending guidance for 2022 from the $405-$470 million range to the $460-$510 million band.
Moreover, the company also updated this year's oil-mix guidance from the 59.5-61.5% range to the 59-60.5% range.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
At this time, Northern Oil and Gas has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. Charting a somewhat similar path, 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 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 these revisions indicates a downward shift. Notably, Northern Oil and Gas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.