A month has gone by since the last earnings report for Noble Energy . Shares have added about 27.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Noble 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.
Noble Energy Q1 Earnings Top Estimates, Revenues lag
Noble Energy, Inc. reported adjusted earnings of 18 cents per share in first-quarter 2020, beating the Zacks Consensus Estimate of 3 cents by a whopping 500%. The company had reported a loss of 9 cents per share in the year-ago quarter.
GAAP loss in the reported quarter was $8.27 compared with a loss of 65 cents per share in the year-ago period.
Total Revenues
Noble Energy's total revenues were $1,020 million, lagging the Zacks Consensus Estimate of $1,079 million by 5.5%. Revenues also declined 3% from the year-ago quarter’s $1,052 million. This year-over-year decline was due to lower contribution from oil, NGL and gas sales.
Highlights of the Release
In the quarter under review, sales volume averaged 390 thousand barrels of oil equivalent per day (MBoe/d), up 15.7% from the year-ago level. U.S. onshore volumes averaged 269 MBoe/d in the first quarter, up 6.3% from the prior-year period. The startup of Leviathan boosted volumes from the Eastern Mediterranean region.
Operating expenses in the reported quarter were $5,353 million, up considerably from $1,143 million recorded in the year-ago period. The increase was primarily due to asset impairments of $2,703 million in first-quarter 2020.
Interest expenses in the reported quarter were $81 million, up 22.7% from the year-ago period.
Realized Prices
U.S. onshore realized crude oil and condensate prices in the reported quarter decreased 13.8% to $46.10 per barrel from the year-ago level of $53.46.
U.S. onshore natural gas prices were $1.27 per thousand cubic feet, down 48.9% year over year.
U.S. onshore realized prices for natural gas liquids also declined 42.3% from the year-ago quarter to $10.30 per barrel.
Financial Highlights
Noble Energy's cash and cash equivalents as of Mar 31, 2020 were $1,397 million compared with $484 million on Dec 31, 2019.
Long-term debt was $8,632 million as of Mar 31, 2020 compared with $7,477 million on Dec 31, 2019.
Cash flow from operating activities in first-quarter 2020 was $482 million, down from $528 million in first-quarter 2019. Capital expenditure in the first quarter was $399 million.
Guidance
COVID-19-induced unprecedented economic crisis resulted in a drop in the demand for oil and gas prices. As a consequence, oil and gas companies are delaying their planned projects and cutting down capital expenditure guidance to preserve liquidity. Similarly, Noble Energy also cut down its 2020 capital expenditure guidance by more than 50%. The revised capital expenditure guidance for 2020 is in the range of $750-$850 million. U.S. onshore capital expenditures are now estimated to be $575 million for 2020.
Noble Energy has also implemented certain measures that can lower expenses by $225 million.
The company is also voluntarily lowering net oil production of 5-10 thousand barrels per day (MBbl/d) in May and 30-40 MBbl/d in June from the U.S. onshore assets.
How Have Estimates Been Moving Since Then?
It turns out, estimates review flatlined during the past month. The consensus estimate has shifted 12.3% due to these changes.
VGM Scores
At this time, Noble 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 C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Noble has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is Noble (NBL) Up 27.1% Since Last Earnings Report?
A month has gone by since the last earnings report for Noble Energy . Shares have added about 27.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Noble 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.
Noble Energy Q1 Earnings Top Estimates, Revenues lag
Noble Energy, Inc. reported adjusted earnings of 18 cents per share in first-quarter 2020, beating the Zacks Consensus Estimate of 3 cents by a whopping 500%. The company had reported a loss of 9 cents per share in the year-ago quarter.
GAAP loss in the reported quarter was $8.27 compared with a loss of 65 cents per share in the year-ago period.
Total Revenues
Noble Energy's total revenues were $1,020 million, lagging the Zacks Consensus Estimate of $1,079 million by 5.5%. Revenues also declined 3% from the year-ago quarter’s $1,052 million. This year-over-year decline was due to lower contribution from oil, NGL and gas sales.
Highlights of the Release
In the quarter under review, sales volume averaged 390 thousand barrels of oil equivalent per day (MBoe/d), up 15.7% from the year-ago level. U.S. onshore volumes averaged 269 MBoe/d in the first quarter, up 6.3% from the prior-year period. The startup of Leviathan boosted volumes from the Eastern Mediterranean region.
Operating expenses in the reported quarter were $5,353 million, up considerably from $1,143 million recorded in the year-ago period. The increase was primarily due to asset impairments of $2,703 million in first-quarter 2020.
Interest expenses in the reported quarter were $81 million, up 22.7% from the year-ago period.
Realized Prices
U.S. onshore realized crude oil and condensate prices in the reported quarter decreased 13.8% to $46.10 per barrel from the year-ago level of $53.46.
U.S. onshore natural gas prices were $1.27 per thousand cubic feet, down 48.9% year over year.
U.S. onshore realized prices for natural gas liquids also declined 42.3% from the year-ago quarter to $10.30 per barrel.
Financial Highlights
Noble Energy's cash and cash equivalents as of Mar 31, 2020 were $1,397 million compared with $484 million on Dec 31, 2019.
Long-term debt was $8,632 million as of Mar 31, 2020 compared with $7,477 million on Dec 31, 2019.
Cash flow from operating activities in first-quarter 2020 was $482 million, down from $528 million in first-quarter 2019. Capital expenditure in the first quarter was $399 million.
Guidance
COVID-19-induced unprecedented economic crisis resulted in a drop in the demand for oil and gas prices. As a consequence, oil and gas companies are delaying their planned projects and cutting down capital expenditure guidance to preserve liquidity. Similarly, Noble Energy also cut down its 2020 capital expenditure guidance by more than 50%. The revised capital expenditure guidance for 2020 is in the range of $750-$850 million. U.S. onshore capital expenditures are now estimated to be $575 million for 2020.
Noble Energy has also implemented certain measures that can lower expenses by $225 million.
The company is also voluntarily lowering net oil production of 5-10 thousand barrels per day (MBbl/d) in May and 30-40 MBbl/d in June from the U.S. onshore assets.
How Have Estimates Been Moving Since Then?
It turns out, estimates review flatlined during the past month. The consensus estimate has shifted 12.3% due to these changes.
VGM Scores
At this time, Noble 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 C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Noble has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.