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Equinor (EQNR) Stock Gains 3% Since Q1 Earnings Beat Estimates

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Equinor ASA’s (EQNR - Free Report) shares have gained almost 3% since it reported strong results for the first quarter of 2022.

Equinor reported first-quarter adjusted earnings per share of $1.60, beating the Zacks Consensus Estimate of $1.57. The bottom line significantly improved from the year-ago quarter’s 82 cents per share.

Total quarterly revenues increased to $36,050 million from $16,129 million in the prior-year quarter.

The strong quarterly results were aided by higher commodity prices and increased contributions from the Martin Linge oil field.

Equinor ASA Price, Consensus and EPS Surprise

 

Equinor ASA Price, Consensus and EPS Surprise

Equinor ASA price-consensus-eps-surprise-chart | Equinor ASA Quote

Segmental Analysis

Exploration & Production Norway (E&P Norway): The segment reported adjusted earnings of $16,258 million, improving drastically from $3,563 million in the year-ago quarter. The improvement was led by higher production and liquid prices.

The company’s average daily production of liquids and gas jumped 4% year over year to 1,436 thousand barrels of oil equivalent per day (MBoe/d) due to the increased contributions from the Martin Linge oil field.

E&P International: The segment’s adjusted operating profit was recorded at $1,081 million, up from the year-ago quarter’s profit of $382 million. Improvement in liquid and gas prices contributed to the outperformance.

Average daily equity production of liquids and gas declined to 341 MBoe/d from 360 MBoe/d in the year-ago quarter. The segment was affected by a natural decline in mature fields.

E&P USA: Through the segment, Equinor generated an adjusted quarterly profit of $713 million, up from $192 million reported in the March-end quarter of 2021. The outperformance was led by higher commodity prices.

The integrated firm’s average equity production of liquids and gas was recorded at 329 MBoe/d, down from 423 MBoe/d in the year-ago quarter due to the divestment of unconventional U.S. onshore assets.

Marketing, Midstream & Processing: The segment reported an adjusted profit of $22 million, significantly down from $61 million a year ago.

Renewables: The segment reported an adjusted loss of $10 million, narrower than a loss of $38 million in the year-ago quarter. Lower expenses associated with the Beacon Wind and Empire Wind properties aided the segment.

Free Cash Flow

In the March-end quarter, Equinor generated a free cash flow of $12,689 million, improving from $5,170 million in the year-ago period. The improvement resulted from increased operating cash flows, backed by higher liquids and gas prices.

Balance Sheet

As of Mar 31, 2022, Equinor reported $20,882 million in cash and cash equivalents. The company’s long-term debt was $27,493 million at the first-quarter end.

Outlook

Equinor reaffirmed production growth expectations at 2% for 2022.

For the 2022-2023 period, the oil major expects average organic capital spending of $10 billion per annum. For the 2024-2025 period, spending is expected to increase to $12 billion per annum.

Zacks Rank & Other Stocks to Consider

Equinor currently sports a Zacks Rank #1 (Strong Buy).

Investors interested in the energy sector might look at the following companies that also presently sport a Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here.

Kinder Morgan Inc. (KMI - Free Report) reported first-quarter 2022 adjusted earnings per share of 32 cents, beating the Zacks Consensus Estimate of 27 cents per share. The better-than-expected results can be attributed to higher refinery utilization rates and a rebound in fuel demand.

Kinder Morgan’s board of directors approved a cash dividend of 27.75 cents per share for the first quarter of 2022. This suggests a 2.8% increase from the prior dividend of 27 cents per share.

EOG Resources, Inc. (EOG - Free Report) reported first-quarter 2022 adjusted earnings per share of $4.00, beating the Zacks Consensus Estimate of $3.69. The strong earnings were driven by higher oil-equivalent production and commodity prices.

EOG Resources announced a special dividend of $1.80 per share. The special dividend is likely to be paid out on Jun 30 to stockholders of record as of Jun 15.

Pioneer Natural Resources Company (PXD - Free Report) reported first-quarter 2022 earnings of $7.74 per share (excluding one-time items), beating the Zacks Consensus Estimate of $7.32. The strong quarterly earnings can be attributed to higher oil-equivalent production volumes and commodity price realizations.

As of Mar 31, 2022, Pioneer Natural’s cash and cash equivalents totaled $2,385 million, while long-term debt was $5,446 million.