Back to top

Image: Bigstock

Pioneer Natural (PXD) Q1 Earnings Beat on Oil Price Rise

Read MoreHide Full Article

Pioneer Natural Resources Company (PXD - Free Report) recently reported first-quarter 2018 earnings, excluding one-time items, of $1.66 per share. The bottom line beat the Zacks Consensus Estimate of $1.51 and the year-earlier quarter adjusted earnings of 25 cents per share.

Revenues and other income in the quarter improved 35.4% year over year to $2,150 million from $1,300 million a year ago. Moreover, the top line beat the Zacks Consensus Estimate of $1,802 million.

Higher oil and liquids price realizations and increased production supported the strong first-quarter results.

 

Production

Total production in the reported quarter averaged approximately 312 thousand barrels of oil equivalent per day (MBOE/d), up 25.3% year over year, surpassing the Zacks Consensus Estimate of 304 MBOE/d. The upside can be attributed to the Permian Basin drilling program, partially offset by fire in a compressor station located in the West Panhandle field and freezing temperatures in early January.

Oil production averaged 183 thousand barrels per day (MBbl/d), up 25.3% from the year-ago quarter, surpassing the Zacks Consensus Estimate of 180 MBbl/d. Natural gas liquids (NGLs) production jumped 40.9% year over year to 66 MBbl/d, beating the Zacks Consensus Estimate of 62 MBbl/d. Natural gas productions increased to 379 million cubic feet per day (MMcf/d) from the year-ago level of 339 MMcf/d, also beating  the Zacks Consensus Estimate of 373 MBOE/d.  

Price Realization

On an oil equivalent basis, average realized price was $45.11 per barrel in the reported quarter, compared with $36.14 a year ago, surpassing the Zacks Consensus Estimate of $41.75. The average realized price for oil was $61.64 per barrel compared with $49.05 in first-quarter 2017, beating the Zacks Consensus Estimate of $57.

Average natural gas price declined 7.2% year over year to $2.59 per thousand cubic feet (Mcf) and lagged the Zacks Consensus Estimate of $2.61. Natural gas liquids were sold at $27.74 per barrel, up from $19.33 in the year-ago quarter, beating the Zacks Consensus Estimate of $24.18.

Cash, Debt and Capex

At the end of the quarter, cash balance was $1,001million. Long-term debt was $2,284 million, representing a debt-to-capitalization ratio of 16.7%.   

Capital Outlay

The company can exceed its previous 2018 budget estimate of $2.9 billion as it prepares for rig additions during the year-end. For 2018, Pioneer Natural intends to fund its capital expenditure from the forecasted cash flow of around $3.2 billion (based on gas price of $2.80 per Mcf and oil price of $66 per barrel).  

Notably, in the first quarter, the company bought back around $17 worth of share. It is included in the company’s $100 million share repurchase program, which is designed to offset the dilution caused by annual employee stock awards.

Guidance

Pioneer Natural expects production between 312 MBOE/d and 322 MBOE/d in the second quarter of 2018. Moreover, the company expects its 2018 production from the prolific Permian Basin to surge 19-24% from the last year. For second quarter, the company expects production costs in the range of $10-$12 per BOE. General and administrative expenses are expected in the range of $90-$95 million.

Zacks Rank and Stocks to Consider

Irving, TX-based Pioneer Natural currently carries a Zacks Rank #3 (Hold).

Investors interested in the Energy sector can opt for some better-ranked stocks in the same space like Nine Energy Service, Inc. (NINE - Free Report) , Oasis Midstream Partners LP and CNOOC Limited (CEO - Free Report) . While Nine Energy Service sports a Zacks Rank #1 (Strong Buy), Oasis Midstream and CNOOC carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Houston, TX-based Nine Energy Service is an onshore service provider. For 2018, the bottom line is likely to be up 33.4%. In the last reported quarter, the company delivered a positive earnings surprise of 6.3%.

Houston, TX-based Oasis Midstream is an integrated energy partnership. The company’s revenues for 2018 are anticipated to improve 29.3% from the prior-year quarter, while its earnings are expected to increase 337.2%.

Hong Kong-based CNOOC is an integrated energy company. The company’s top line for 2018 is anticipated to improve 49% year over year, while its bottom line is expected to increase 82.8%.

5 Medical Stocks to Buy Now

Zacks names 5 companies poised to ride a medical breakthrough that is targeting cures for leukemia, AIDS, muscular dystrophy, hemophilia, and other conditions.

New products in this field are already generating substantial revenue and even more wondrous treatments are in the pipeline. Early investors could realize exceptional profits.

Click here to see the 5 stocks >>

Published in