U.S. energy explorer
Apache Corporation ( APA Quick Quote APA - Free Report) reported fourth-quarter 2020 loss per share — excluding one-time items — of 5 cents, narrower than the Zacks Consensus Estimate of a loss of 8 cents. The outperformance reflects robust domestic production and a tight leash on costs. Precisely, the average daily U.S. output came in at 232,975 barrels of oil-equivalent per day (BOE/d), beating the Zacks Consensus Estimate of 230,000 BOE/d. However, Apache’s bottom line compared unfavorably with the year-earlier quarter's adjusted earnings of 8 cents due to sharply lower oil prices. Revenues of $1.2 billion outpaced the Zacks Consensus Estimate of $1 billion million but fell 29.5% from the year-ago quarter’s sales of $1.7 billion. Costs & Financial Position
Apache’s fourth-quarter lease operating expenses totaled $269 million, down 22% from the year-ago period. Moreover, total operating expenses plunged 75% from the corresponding period of 2019 to $1.2 billion. Apart from a significant drop in lease operating expenses, the improvement came on the back of lower depreciation and amortization expenses and the absence of the year-ago quarter’s impairment charges.
During the quarter under review, Apache generated $498 million of cash from operating activities while incurred $189 million in upstream capital expenditures. The company reported an adjusted operating cash flow of $500 million in the fourth quarter. As of Dec 31, Apache had approximately $262 million in cash and cash equivalents, and $8.1 billion in long-term debt. Guidance
The company provided guidance of $1.1 billion upstream capital expenditure this year, up from $988 million spent in 2020. Importantly, Apache expects to self-fund its capital expenditure with internally generated cash flows. This assumes WTI price of $45 and natural gas price of $3. Further, Apache is projecting a marginal (approximately 1%) decrease in adjusted oil production from the fourth quarter of 2020 to fourth quarter of 2021.
Zacks Rank & Stock Picks
Apache currently carries a Zacks Rank #2 (Buy).
Apart from Apache, investors interested in the energy space might look at other options like PDC Energy ( PDCE Quick Quote PDCE - Free Report) , Royal Dutch Shell ( RDS.A Quick Quote RDS.A - Free Report) and Ovintiv ( OVV Quick Quote OVV - Free Report) . All the companies carry a Zacks Rank #1 (Strong Buy). You can see . the complete list of today’s Zacks #1 Rank stocks here PDC Energy has an expected earnings growth rate of 165.91% for the current year. Royal Dutch Shell has an expected earnings growth rate of 165.32% for the current year. Ovintiv has an expected earnings growth rate of 465.71% for the current year. More Stock News: This Is Bigger than the iPhone!
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