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Cimarex (XEC) Up 4.5% Since Q3 Earnings Beat on Gas Prices
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Cimarex Energy Co. stock increased 4.5%, following better-than-expected quarterly results reported on Nov 4. The company has reiterated the capital expenditure plan for 2020, while boosting its production guidance.
It reported third-quarter 2020 adjusted earnings per share of 51 cents, outpacing the Zacks Consensus Estimate of 21 cents. However, the company reported earnings of 94 cents per share in the year-ago quarter.
Total revenues of $401.7 million beat the Zacks Consensus Estimate of $376 million but decreased from the year-ago quarter’s $582.3 million.
The better-than-expected quarterly results can be attributed to higher natural gas price realizations and lower production expenses, partially offset by decreased overall production and realized crude prices.
Cimarex Energy Co Price, Consensus and EPS Surprise
For the quarter under review, total production averaged 249.4 thousand barrels of oil equivalent per day (MBoe/d), down from 287.1 MBoe/d in the year-ago period on considerably lower activities in the Mid-Continent. Output from the basin also declined 21.9% year over year to 68.8 MBoe/d.
Total oil volumes fell to 71.6 thousand barrels per day (MBbls/d) from 89.7 MBbls/d in the year-ago period. Moreover, natural gas production decreased to 603.4 MMcf/d from the year-ago level of 718 MMcf/d. Also, natural gas liquids (NGL) volumes marginally dropped to 77.3 MBbls/d from the year-ago figure of 77.7 MBbls/d.
Realized Prices
Realized price of crude oil fell from $52.71 per barrel in the prior-year quarter to $37.94. However, the same for NGL increased marginally to $10.89 from $10.80 in the year-ago quarter. Moreover, realized prices for natural gas rose to $1.14 per thousand cubic feet from 88 cents recorded a year ago.
Costs and Expenses
Overall costs and expenses for the quarter surged to $757.4 million from the year-ago level of $409.6 million, primarily due to impairment charges. General and administrative expenses rose to $28.6 million from $15.5 million in the year-ago period. Production expense for the third quarter was recorded at $62 million, down from the prior-year figure of $89.8 million. Also, transportation, processing and other operating costs decreased to $53.1 million from the year-ago figure of $59.8 million.
Financial Condition
As of Sep 30, 2020, the company had cash and cash equivalents of $273 million, up from $43.8 million in the second quarter. Net long-term debt was almost $2 billion, representing a net long-term debt to capital of 56.3%. It has no debt maturities in the next four years.
Cimarex's adjusted cash flow from operating activities totaled $236.7 million, down from $360.7 million in the prior-year quarter. The company spent $80.5 million on exploration and development in the September quarter.
Guidance
Cimarex increased average total production guidance for 2020 to 250-255 MBoe/d. However, the expected range suggests a decline from the 2019 level of 278.5 MBoe/d. Full-year 2020 oil production will likely be in the band of 75.5-77.5 MBbls/d, suggesting fall from the 2019 figure of 86.2 MBbls/d. For the fourth quarter, the company expects total output within 215-235 MBoe/d.
As stated earlier, total capital expenditure for the year will likely be $600 million, of which $430 million will be used for drilling and completion, while $40 million will be spent on midstream and saltwater disposal. The company expects 2020 free cash flow of more than $200 million after dividend payments.
It expects production expenses for full-year 2020 in the range of $2.90-$3.10 per Boe. Transportation, processing & other expenses will likely be in the band of $2.10-$2.40 per Boe.
Matador Resources’ bottom line for 2021 is expected to surge 187% year over year.
Antero Resources’ bottom line for 2021 is expected to rise 28.2% year over year.
NuStar Energy’s bottom line for 2021 is expected to rise 177.5% year over year.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Cimarex (XEC) Up 4.5% Since Q3 Earnings Beat on Gas Prices
Cimarex Energy Co. stock increased 4.5%, following better-than-expected quarterly results reported on Nov 4. The company has reiterated the capital expenditure plan for 2020, while boosting its production guidance.
It reported third-quarter 2020 adjusted earnings per share of 51 cents, outpacing the Zacks Consensus Estimate of 21 cents. However, the company reported earnings of 94 cents per share in the year-ago quarter.
Total revenues of $401.7 million beat the Zacks Consensus Estimate of $376 million but decreased from the year-ago quarter’s $582.3 million.
The better-than-expected quarterly results can be attributed to higher natural gas price realizations and lower production expenses, partially offset by decreased overall production and realized crude prices.
Cimarex Energy Co Price, Consensus and EPS Surprise
Cimarex Energy Co price-consensus-eps-surprise-chart | Cimarex Energy Co Quote
Operational Highlights
Production
For the quarter under review, total production averaged 249.4 thousand barrels of oil equivalent per day (MBoe/d), down from 287.1 MBoe/d in the year-ago period on considerably lower activities in the Mid-Continent. Output from the basin also declined 21.9% year over year to 68.8 MBoe/d.
Total oil volumes fell to 71.6 thousand barrels per day (MBbls/d) from 89.7 MBbls/d in the year-ago period. Moreover, natural gas production decreased to 603.4 MMcf/d from the year-ago level of 718 MMcf/d. Also, natural gas liquids (NGL) volumes marginally dropped to 77.3 MBbls/d from the year-ago figure of 77.7 MBbls/d.
Realized Prices
Realized price of crude oil fell from $52.71 per barrel in the prior-year quarter to $37.94. However, the same for NGL increased marginally to $10.89 from $10.80 in the year-ago quarter. Moreover, realized prices for natural gas rose to $1.14 per thousand cubic feet from 88 cents recorded a year ago.
Costs and Expenses
Overall costs and expenses for the quarter surged to $757.4 million from the year-ago level of $409.6 million, primarily due to impairment charges. General and administrative expenses rose to $28.6 million from $15.5 million in the year-ago period. Production expense for the third quarter was recorded at $62 million, down from the prior-year figure of $89.8 million. Also, transportation, processing and other operating costs decreased to $53.1 million from the year-ago figure of $59.8 million.
Financial Condition
As of Sep 30, 2020, the company had cash and cash equivalents of $273 million, up from $43.8 million in the second quarter. Net long-term debt was almost $2 billion, representing a net long-term debt to capital of 56.3%. It has no debt maturities in the next four years.
Cimarex's adjusted cash flow from operating activities totaled $236.7 million, down from $360.7 million in the prior-year quarter. The company spent $80.5 million on exploration and development in the September quarter.
Guidance
Cimarex increased average total production guidance for 2020 to 250-255 MBoe/d. However, the expected range suggests a decline from the 2019 level of 278.5 MBoe/d. Full-year 2020 oil production will likely be in the band of 75.5-77.5 MBbls/d, suggesting fall from the 2019 figure of 86.2 MBbls/d. For the fourth quarter, the company expects total output within 215-235 MBoe/d.
As stated earlier, total capital expenditure for the year will likely be $600 million, of which $430 million will be used for drilling and completion, while $40 million will be spent on midstream and saltwater disposal. The company expects 2020 free cash flow of more than $200 million after dividend payments.
It expects production expenses for full-year 2020 in the range of $2.90-$3.10 per Boe. Transportation, processing & other expenses will likely be in the band of $2.10-$2.40 per Boe.
Zacks Rank & Stocks to Consider
The company currently has a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include Matador Resources Company (MTDR - Free Report) , Antero Resources Corporation (AR - Free Report) and NuStar Energy L.P. (NS - Free Report) , each holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Matador Resources’ bottom line for 2021 is expected to surge 187% year over year.
Antero Resources’ bottom line for 2021 is expected to rise 28.2% year over year.
NuStar Energy’s bottom line for 2021 is expected to rise 177.5% year over year.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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