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MDU Resources (MDU) Up 1.3% Since Last Earnings Report: Can It Continue?

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It has been about a month since the last earnings report for MDU Resources (MDU - Free Report) . Shares have added about 1.3% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is MDU Resources due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

MDU Resources' Q2 Earnings Miss Mark, Revenues Rise Y/Y

MDU Resources reported second-quarter 2021 operating earnings of 50 cents per share, which missed the Zacks Consensus Estimate of 53 cents by 5.7%. The same was on par with the year-ago level.

Total Revenues

Total revenues came in at $1,423.7 million, up 4.5% from $1,362.9 million in the year-ago quarter.

Operating revenues in the electric, natural gas distribution and regulated pipeline improved 8% from the prior-year quarter’s level to $260.6 million. Revenues in non-regulated pipeline, construction materials and contracting, construction services and other segments moved up 3.7% from the year-ago quarter’s level to $1,163.1 million.

Highlights of the Release

For the quarter under review, operating expenses of $1,286 million increased 5% from the prior-year period’s $1,224.6 million.

Operating income was $137.7 million, down 0.4% year over year.

The company’s interest expenses of $23.4 million were down 5.6% from $24.8 million in the prior-year quarter.

As of Jun 30, 2021, the construction services business had a backlog of $1.32 billion compared to $1.31 billion onJun 30, 2020.

As of Jun 30, 2021, the construction materials business had a backlog of $912 million, up from $875 million year over year.

Financial Highlights

Cash and cash equivalents as of Jun 30, 2021 were $58 million compared with $59.5 million at 2020 end.

Long-term debt amounted to $2,335.5 million as of Jun 30, 2021 compared with $2,211.6 million on Dec 31, 2020.

The company’s net cash provided by operating activities in the first two quarters of 2021 was $182.8 million compared with $261.4 million in the comparable period of 2020.

Guidance

MDU Resources reaffirmed its 2021 earnings per share guidance at $2-$2.15. This estimate is based on several assumptions, of which worth mentioning are normal weather and a continued addition to the electric and natural gas customers at 1-2% rate, annually. In the long term, the utility expects earnings to grow 5-8% on an annual basis.

It reduced its investment plans to $806 million from $810.5 million in the ongoing year. It plans to invest $3,027 million during the 2021-2025 forecast period.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.


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