Independent oil & gas exploration and production firm, Cimarex Energy Company reported third-quarter 2016 earnings of 41 cents per share, which beat the Zacks Consensus Estimate of 37 cents. In the third quarter of 2015, the company incurred a loss of 15 cents per share.
TOTAL REVENUES
In the third quarter, Cimarex Energy’s total revenue of $335.7 million lagged the Zacks Consensus Estimate of $341.02 million. Reported revenues also decreased from $356.1 million a year ago.
Operational Highlights
In the quarter under review, total production averaged 947 million cubic feet equivalent (MMcfe) per day, down 3.3 year over year. Oil volumes declined 10.8% to 44.5 thousand barrels per day (MBbls/d), natural gas volumes decreased 3.8% to 446.7 MMcf, whereas natural gas liquids (NGL) volumes were up 8.3% to 38.8 MBbls/d, all on a year-over-year basis.
Year-over-year realized prices for natural gas, crude oil and NGL dipped 0.7% to $2.66 per thousand cubic feet, was down 3.2% $40.54 per barrel but was up 16% to $14.14 per barrel respectively, in the reported quarter.
The company brought 42 gross (17 net) wells onstream during the quarter. As of Sep 30, 2016, 104 gross (45 net) wells were awaiting completion. Cimarex Energy is currently operating eight drilling rigs and intends to increase it to nine by the end of this year.
Financial Condition
As of Sep 30, 2016, Cimarex Energy had cash and cash equivalents of $698.7 million, down from $899.3 million as of Sep 30, 2015. As of Sep 30, 2016, long-term debt was $1.5 billion, which represents a debt-to-capitalization ratio of 38.9%.
Cimarex Energy's net cash from operating activities during the quarter was $215.6 million compared with $206 million in the prior-year period. Cimarex Energy invested $175 million in exploration and development during the third quarter, which was primarily funded with cash flow from operations.
Guidance
Total production for the fourth quarter is projected to average 945–985 MMcfe per day. Based on the fourth-quarter guidance, full-year production is has been lowered and is now estimated to average 960–970 MMcfe per day. Capital investment for exploration and development is estimated at $785 million for 2016, up $35 million from the previous guidance.
For 2017, production is forecasted to range between 1,050–1,100 MMcfe per day, up 11% year over year at the midpoint. Initial estimate for drilling and completion capital in 2017 is $600 million, same as the 2016 level.
Zacks Rank
Cimarex Energy currently has a Zacks Rank #3 (Hold).
Some better-ranked players from the same sector are Enbridge Inc. (ENB), Braskem SA (BAK) and TransCanada Corporation (TRP). All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Enbridge Inc. reported a negative earnings surprise of 10.00% in the year-ago quarter.
TransCanada posted a positive earnings surprise of 22.92% in the last reported quarter.
Enviva Partners has a mixed earnings surprise history. The partnership posted positive earnings surprises in two of the last four quarters. It reported a positive earnings surprise of 20.51% in the preceding quarter.
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Independent oil & gas exploration and production firm, Cimarex Energy Company reported third-quarter 2016 earnings of 41 cents per share, which beat the Zacks Consensus Estimate of 37 cents. In the third quarter of 2015, the company incurred a loss of 15 cents per share.
TOTAL REVENUES
In the third quarter, Cimarex Energy’s total revenue of $335.7 million lagged the Zacks Consensus Estimate of $341.02 million. Reported revenues also decreased from $356.1 million a year ago.
Operational Highlights
In the quarter under review, total production averaged 947 million cubic feet equivalent (MMcfe) per day, down 3.3 year over year. Oil volumes declined 10.8% to 44.5 thousand barrels per day (MBbls/d), natural gas volumes decreased 3.8% to 446.7 MMcf, whereas natural gas liquids (NGL) volumes were up 8.3% to 38.8 MBbls/d, all on a year-over-year basis.
Year-over-year realized prices for natural gas, crude oil and NGL dipped 0.7% to $2.66 per thousand cubic feet, was down 3.2% $40.54 per barrel but was up 16% to $14.14 per barrel respectively, in the reported quarter.
The company brought 42 gross (17 net) wells onstream during the quarter. As of Sep 30, 2016, 104 gross (45 net) wells were awaiting completion. Cimarex Energy is currently operating eight drilling rigs and intends to increase it to nine by the end of this year.
Financial Condition
As of Sep 30, 2016, Cimarex Energy had cash and cash equivalents of $698.7 million, down from $899.3 million as of Sep 30, 2015. As of Sep 30, 2016, long-term debt was $1.5 billion, which represents a debt-to-capitalization ratio of 38.9%.
Cimarex Energy's net cash from operating activities during the quarter was $215.6 million compared with $206 million in the prior-year period. Cimarex Energy invested $175 million in exploration and development during the third quarter, which was primarily funded with cash flow from operations.
Guidance
Total production for the fourth quarter is projected to average 945–985 MMcfe per day. Based on the fourth-quarter guidance, full-year production is has been lowered and is now estimated to average 960–970 MMcfe per day. Capital investment for exploration and development is estimated at $785 million for 2016, up $35 million from the previous guidance.
For 2017, production is forecasted to range between 1,050–1,100 MMcfe per day, up 11% year over year at the midpoint. Initial estimate for drilling and completion capital in 2017 is $600 million, same as the 2016 level.
Zacks Rank
Cimarex Energy currently has a Zacks Rank #3 (Hold).
Some better-ranked players from the same sector are Enbridge Inc. (ENB), Braskem SA (BAK) and TransCanada Corporation (TRP). All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Enbridge Inc. reported a negative earnings surprise of 10.00% in the year-ago quarter.
TransCanada posted a positive earnings surprise of 22.92% in the last reported quarter.
Enviva Partners has a mixed earnings surprise history. The partnership posted positive earnings surprises in two of the last four quarters. It reported a positive earnings surprise of 20.51% in the preceding quarter.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>