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Range Resources (RRC) Q3 Earnings Beat on Record Production
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Range Resources Corporation (RRC - Free Report) recently reported third-quarter 2018 earnings (adjusted for one-time items) of 26 cents per share, beating the Zacks Consensus Estimate of 18 cents. The bottom line surged 420% from the year-ago quarter’s figure of 5 cents.
Earnings in third-quarter 2018 were boosted by increase in oil and gas equivalent production as well as price realizations, partially offset by higher expenses.
Total revenues of $811.2 million beat the Zacks Consensus Estimate of $721 million. Moreover, the top line surged 683% year over year from $482 million in the prior-year quarter.
Range Resources Corporation Price, Consensus and EPS Surprise
During the third quarter, the company’s production touched record level of around 2,266.7 million cubic feet equivalent per day (MMcfe/d). Natural gas contributed 67.5% to the total production, while natural gas liquids (NGLs) and oil accounted for the remaining 32.5%.
Total production improved 14% from the year-ago quarter’s tally and surpassed the Zacks Consensus Estimate of 2,220 MMcfe/d, primarily owing to improvement in the Appalachia division.
On a year-over-year basis, oil production declined 19%, while NGL production rose 15%. Natural gas production jumped 16% year over year.
Price Realization
The company’s total price realization (including the effects of hedges and derivative settlements) averaged $1.90 per thousand cubic feet equivalent (Mcfe), up 5% from the prior-year quarter’s figure. Of this, NGL prices surged 40% to $11.92 per barrel and crude oil prices rose 8% to $52.33 per barrel, both on a year-over-year basis. However, natural gas prices were down 2% year over year to $1.56 per Mcf.
Expenses
Direct operating costs in the third quarter was $30.4 million, down 16.4% from the year-ago quarter’s tally. Total expenses were $738.5 million, up 8% year over year.
Financials
At the end of the quarter, the company had a total debt of approximately $4,160.9 million, with a debt-to-capitalization ratio of 41.7%. The company’s expenditure totaled $191 million in the third quarter for drilling and completion of 24 net wells.
Guidance
For the fourth quarter of 2018, the company projects production between 2,255-2,265 Mmcfe per day. Given this, the annual output is likely to rise 11%.
The upstream energy player reiterated 2018 capital budget of $941 million. The budget will be funded by the company’s cash flow.
Q3 Price Performance
During the quarter, Range Resources’ shares gained 1.6%, against the industry’s 3.5% decline.
Zacks Rank & Other Key Picks
Range Resources currently sports a Zacks Rank #1 (Strong Buy).
Denbury is an exploration and production (E&P) company engaged in the acquisition, development, operation, and exploration of oil and natural gas properties. It pulled off an average positive earnings surprise of 162.9% in the last four quarters.
Shell Midstream Partners is involved in owning, operating, developing and acquiring pipelines and other midstream assets. The partnership delivered an average positive earnings surprise of 7.9% in the trailing four quarters.
Based in Rome, Italy, Eni is among the leading integrated energy players in the world. The partnership reported a negative earnings surprise of 0.3% in the last four quarters.
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Range Resources (RRC) Q3 Earnings Beat on Record Production
Range Resources Corporation (RRC - Free Report) recently reported third-quarter 2018 earnings (adjusted for one-time items) of 26 cents per share, beating the Zacks Consensus Estimate of 18 cents. The bottom line surged 420% from the year-ago quarter’s figure of 5 cents.
Earnings in third-quarter 2018 were boosted by increase in oil and gas equivalent production as well as price realizations, partially offset by higher expenses.
Total revenues of $811.2 million beat the Zacks Consensus Estimate of $721 million. Moreover, the top line surged 683% year over year from $482 million in the prior-year quarter.
Range Resources Corporation Price, Consensus and EPS Surprise
Range Resources Corporation Price, Consensus and EPS Surprise | Range Resources Corporation Quote
Operational Performance
Production
During the third quarter, the company’s production touched record level of around 2,266.7 million cubic feet equivalent per day (MMcfe/d). Natural gas contributed 67.5% to the total production, while natural gas liquids (NGLs) and oil accounted for the remaining 32.5%.
Total production improved 14% from the year-ago quarter’s tally and surpassed the Zacks Consensus Estimate of 2,220 MMcfe/d, primarily owing to improvement in the Appalachia division.
On a year-over-year basis, oil production declined 19%, while NGL production rose 15%. Natural gas production jumped 16% year over year.
Price Realization
The company’s total price realization (including the effects of hedges and derivative settlements) averaged $1.90 per thousand cubic feet equivalent (Mcfe), up 5% from the prior-year quarter’s figure. Of this, NGL prices surged 40% to $11.92 per barrel and crude oil prices rose 8% to $52.33 per barrel, both on a year-over-year basis. However, natural gas prices were down 2% year over year to $1.56 per Mcf.
Expenses
Direct operating costs in the third quarter was $30.4 million, down 16.4% from the year-ago quarter’s tally. Total expenses were $738.5 million, up 8% year over year.
Financials
At the end of the quarter, the company had a total debt of approximately $4,160.9 million, with a debt-to-capitalization ratio of 41.7%. The company’s expenditure totaled $191 million in the third quarter for drilling and completion of 24 net wells.
Guidance
For the fourth quarter of 2018, the company projects production between 2,255-2,265 Mmcfe per day. Given this, the annual output is likely to rise 11%.
The upstream energy player reiterated 2018 capital budget of $941 million. The budget will be funded by the company’s cash flow.
Q3 Price Performance
During the quarter, Range Resources’ shares gained 1.6%, against the industry’s 3.5% decline.
Zacks Rank & Other Key Picks
Range Resources currently sports a Zacks Rank #1 (Strong Buy).
A few other top-ranked players in the same sector are Denbury Resources Inc , Shell Midstream Partners, L.P and Eni SpA (E - Free Report) . All these stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Denbury is an exploration and production (E&P) company engaged in the acquisition, development, operation, and exploration of oil and natural gas properties. It pulled off an average positive earnings surprise of 162.9% in the last four quarters.
Shell Midstream Partners is involved in owning, operating, developing and acquiring pipelines and other midstream assets. The partnership delivered an average positive earnings surprise of 7.9% in the trailing four quarters.
Based in Rome, Italy, Eni is among the leading integrated energy players in the world. The partnership reported a negative earnings surprise of 0.3% in the last four quarters.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
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