Back to top

Image: Bigstock

Range Resources (RRC) Up 4% Since Q2 Earnings Beat Estimates

Read MoreHide Full Article

Range Resources Corporation’s (RRC - Free Report) shares have gained almost 4% since it reported strong second-quarter earnings on Jul 25.

The company posted second-quarter 2022 adjusted earnings of $1.27 per share, beating the Zacks Consensus Estimate of $1.21 per share. The bottom line significantly improved from the prior-year quarter’s earnings of 24 cents per share.

Total quarterly revenues of $1,225.1 million surpassed the Zacks Consensus Estimate of $981 million. The top line also improved from the prior-year quarter’s $434.7 million.

The strong quarterly results were driven by higher realizations of commodity prices.

Range Resources Corporation Price, Consensus and EPS Surprise

 

Range Resources Corporation Price, Consensus and EPS Surprise

Range Resources Corporation price-consensus-eps-surprise-chart | Range Resources Corporation Quote

Operational Performance

For second-quarter 2022, the company’s production averaged 2,073.9 million cubic feet equivalent per day, down 1% from the prior-year period. Natural gas contributed 69.8% to total production, while NGLs and oil accounted for the rest.

Oil production declined 8% from the year-ago period, while NGL output declined 4%. Natural gas production remained flat year over year.

Its total price realization (excluding derivative settlements and before third-party transportation costs) averaged $7.19 per thousand cubic feet equivalent (Mcfe), up 121% year over year. Natural gas prices rose 183% on a year-over-year basis to $6.91 per Mcf. NGL and oil prices increased 53% and 76%, respectively.

Costs & Expenses

Total costs and expenses rose to $669 million from $592.5 million in the year-ago quarter. Total transportation, gathering, processing and compression costs, as well as exploration costs, increased in the reported quarter.

Direct operating costs of 10 cents per Mcfe in the June-end quarter of 2022 remained flat from the year-ago quarter. Transportation, gathering, processing and compression expenses were recorded at $1.70 per Mcfe, higher than $1.48 in the prior-year quarter.

Capital Expenditure & Balance Sheet

In second-quarter 2022, the company’s drilling and completion expenditure was $119 million. An amount of $7.5 million was used in acreage and gathering facilities.

At the second-quarter end, it had total debt of $1,830.5 million, with a debt-to-capitalization of 48.1%.

Outlook

For 2022, Range Resources reiterated its total production guidance of 2.12-2.16 billion cubic feet equivalent per day (Bcfe/d), with 30% attributed to liquids production.

RRC anticipates capital spending of $460-$480 million for the year. Direct operating expenses are projected to be 9-11 cents per Mcfe, while exploration expenses are estimated to be $22-$28 million.

The upstream energy firm expects the free cash flow to exceed $1.5 billion this year. Also, it expects to initiate a dividend of $0.32 per share (at an annualized rate) in the third quarter.

Zacks Rank

Range Resources currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Snapshot of Other Energy Players

Chevron Corporation (CVX - Free Report) reported adjusted second-quarter earnings per share of $5.82, beating the Zacks Consensus Estimate of $5.02. The outperformance was driven by robust commodity prices and product margins, which propelled both CVX segments to record better-than-expected bottom-line results.

As of Jun 30, Chevron had $12 billion in cash and cash equivalents, and total debt of $26.2 billion, with a debt-to-total capitalization of 14.6%. Further, Chevron paid out $2.8 billion in dividends and bought back $2.5 billion worth of its shares in the second quarter.

TotalEnergies SE (TTE - Free Report) reported second-quarter 2022 operating earnings of $3.75 per share, meeting the Zacks Consensus Estimate. The improvement was due to an increase in commodity prices.

In second-quarter 2022, TotalEnergies acquired $2,464 million worth of assets and sold assets valued at $388 million. TTE bought back shares worth $2 billion in the second quarter. TotalEnergies expects to invest $16 billion in 2022, out of which 25% will be allocated to further strengthen renewable operation and electricity.

Shell plc (SHEL - Free Report) reported second-quarter earnings per ADS (on a current cost of supplies basis, excluding items — the market’s preferred measure) of $3.06. The bottom line beat the Zacks Consensus Estimate of $2.91 due to stronger commodity prices and refining margins.

Shell has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Value, Growth and Momentum. Shell is expected to see earnings growth of 128.3% in 2022.