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PDC Energy (PDCE) Q4 Earnings Beat Thanks to Production Gains

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Upstream operator PDC Energy, Inc. reported adjusted earnings per share of $1.10, comfortably ahead of the Zacks Consensus Estimate of 82 cents. The company had reported profit of 60 cents in the year-ago quarter. The outperformance can be primarily attributed to better-than-anticipated production volumes. Precisely, the Colorado-focused company’s output of 16,574 thousand barrels of oil-equivalent (MBoe) surpassed the Zacks Consensus Estimate of 16,135 MBoe.

Meanwhile, PDC Energy recorded total revenues of $278.6 million, missing the consensus mark by 22.8% due to lower oil price realizations. However, the top line came in higher than the year-ago level of $265 million.

Production & Prices

For the fourth quarter of 2020, PDC Energy’s production totaled 16,574 MBoe (58% liquids), reflecting an increase of 27% from 13,060 MBoe a year ago. Of the aggregate output, 13,952 MBoe (or 84%) came from Wattenberg Field and the rest from Delaware Basin.

The average realized natural gas price increased from $1.28 per thousand cubic feet (Mcf) in the year-ago quarter to $1.58. PDC Energy sold NGLs at an average price of $12.76 per barrels (Bbls) compared to $13.82 a year ago. Meanwhile, the average oil price realization came in at $40.43 per barrel, 24% lower than $53.13 in the year-ago period. Overall, the company fetched $20.72 per MBoe compared with $26.02 a year ago.
 

PDC Energy, Inc. Price, Consensus and EPS Surprise

PDC Energy, Inc. Price, Consensus and EPS Surprise

PDC Energy, Inc. price-consensus-eps-surprise-chart | PDC Energy, Inc. Quote

 

Capital Expenditure & Balance Sheet

The energy explorer shelled out $110 million in the form of oil and gas capital investments. As of Dec 31, PDC Energy had approximately $2.6million in cash and cash equivalents, and $1.4 billion in long-term debt, representing a debt-to-capitalization of 35%.

Guidance

PDC Energy expects to churn out 190,000-200,000 Boe per day in 2021, up from the prior guidance of 175,000-185,000 Boe per day. However, it reiterated its oil production guidance of 64,000-68,000 Bbls per day. Further, the company still expects to spend between $500 million and $600 million this year and plans to generate free cash flow in excess of $400 million (at a WTI price of $45, natural gas at $2.5 and NGL at $12).

Zacks Rank & Stock Picks

PDC Energy currently carries a Zacks Rank #1 (StrongBuy).

Apart from PDC Energy, investors interested in the energy space might look at other options like Diamondback Energy (FANG - Free Report) , Royal Dutch Shell and Ovintiv (OVV - Free Report) . All the companies carry a Zacks Rank #1.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Diamondback Energy has an expected earnings growth rate of 84.21% 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 620% for the current year.

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