A month has gone by since the last earnings report for ONE Gas (OGS Quick QuoteOGS - Free Report) . Shares have added about 8.5% in that time frame, outperforming the S&P 500.

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

ONE Gas' Q4 Earnings Match Estimates, Revenues Beat

ONE Gas Inc. reported fourth-quarter 2021 earnings of $1.12 per share, on par with the Zacks Consensus Estimate.

The bottom line improved 2.8% from the year-ago earnings, primarily due to contribution from new rates in Oklahoma and Texas, demand from expanding residential customer base and a fall in bad debt expenses.

Adjusted earnings of ONE Gas in 2021 were $3.85 per share, meeting the Zacks Consensus Estimate. Annual earnings per share increased 4.6% year over year. Earnings per share came within the guidance of  $3.80-$3.90.

Total Revenues

ONE Gas recorded revenues of $593.7 million in the fourth quarter, which surpassed the Zacks Consensus Estimate of $507 million by 17.2%. The top line also improved 22.6% from the year-ago level.

Total revenues in 2021 were $1.8 billion, increasing 17.6% year over year and surpassing the Zacks Consensus Estimate of $1.71 billion by 5.3%.

Highlights of the Release

Total natural gas volumes delivered in 2021 were 387.8 billion cubic feet (Bcf), up 0.7% from 2020 due to improving transportation sales volume and Commercial and industrial sales volume.

Total operating expenses in the reported quarter increased 4.2% from the year-ago figure to $198.9 million.

Operating income in the reported quarter increased 2.4% year over year to $87 million.

It incurred net interest expenses of $14.4 million, down 5.4%.

In  2021, ONE Gas’ customer base rose 0.9% from 2020, primarily due to additions to the residential customer group.

Financial Highlights

As of Dec 31, 2021, ONE Gas had cash and cash equivalents of $8.8 million compared with $8 million as of Dec 31, 2020.

Long-term debt (excluding current maturities) was $3,683.4 million as of Dec 31, 2021, compared with $1,582.2 million as of Dec 31, 2020.

Cash provided by (used in) operating activities during 2021 was ($1,535.6) million versus $364.5 million in 2020.

Guidance

ONE Gas expects 2022 net income in the range of $215-$227 million and earnings per share in the band of $3.96-$4.20. The midpoint of earnings guidance is $4.08, on par with the Zacks Consensus Estimate.

Capital expenditure is expected to be $650 million for 2022, with more than 65% of the planned expenditure for improving system integrity and expansion of services in new regions.

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.

VGM Scores

At this time, ONE Gas has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

ONE Gas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.