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Enbridge (ENB) Stock Dips 2% Since Q2 Earnings Miss Estimates

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Enbridge Inc. (ENB - Free Report) has declined almost 2% since it reported weak second-quarter 2022 earnings on Jul 29, before the opening bell.

Enbridge recorded second-quarter adjusted earnings per share of 53 cents, missing the Zacks Consensus Estimate of earnings of 56 cents. The bottom line also declined from the year-ago quarter’s 55 cents.

Total quarterly revenues of $10,355 million increased from $8,913 million in the prior-year quarter.

Weak quarterly earnings can be attributed to lower contributions from the company’s Energy Services, and Gas Transmission and Midstream businesses. The negatives were partially offset by higher contributions from the Liquids Pipelines segment.

Enbridge Inc Price, Consensus and EPS Surprise

 

Enbridge Inc Price, Consensus and EPS Surprise

Enbridge Inc price-consensus-eps-surprise-chart | Enbridge Inc Quote

Segmental Analysis

Enbridge conducts business through five segments — Liquids Pipelines, Gas Transmission and Midstream, Gas Distribution and Storage, Renewable Power Generation, and Energy Services.

Liquids Pipelines: The segment’s adjusted earnings before interest, income taxes, and depreciation and amortization (EBITDA) totaled C$2,095 million, up from C$1,844 million in the year-earlier quarter. Higher contributions from Mainline System, Gulf Coast and Mid-Continent System primarily aided the segment.

Gas Transmission and Midstream: The segment’s adjusted earnings totaled C$1,084 million, up from C$935 million in second-quarter 2021. Higher contributions from Canadian Gas Transmission, and the U.S. Midstream primarily aided the segment’s performance.

Gas Distribution and Storage: The unit generated a profit of C$422 million, down from C$461 million in the prior-year quarter due to lower contributions from Enbridge Gas Inc.

Renewable Power Generation: The segment recorded earnings of C$127 million, up from C$113 million in the prior-year quarter, as the energy giant witnessed strong wind resources from offshore wind facilities in Canada and the United States, and higher energy prices at the Rampion offshore wind facilities.

Energy Services: The segment incurred a loss of C$99 million, wider than a loss of C$86 million recorded in second-quarter 2021.

Distributable Cash Flow (DCF)

In second-quarter 2022, Enbridge reported a DCF of C$2,747 million, representing an increase from C$2,503 million a year ago.

Balance Sheet

At the end of second-quarter 2022, Enbridge reported long-term debt of C$70,005 million. It had cash and cash equivalents of C$1,045 million. The current portion of long-term debt was C$7,188 million. ENB’s long-term debt to capitalization was 53% at the end of the second quarter.

Guidance

For 2022, Enbridge reaffirmed its guidance for EBITDA at C$15-C$15.6 billion, indicating an increase from C$14 billion reported last year.

The company expects DCF per share of C$5.2-C$5.5 for the year. This suggests an increase from C$4.96 reported last year. Enbridge added more than $3.6 billion of new projects to its growth backlog, bringing the total newly sanctioned growth projects in 2022 to $4.5 billion.

Zacks Rank & Stocks to Consider

The company currently carries a Zacks Rank #3 (Hold). Investors interested in the energy sector might look at the following companies that presently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

RPC, Inc. (RES - Free Report) reported adjusted earnings of 22 cents per share in the second quarter, beating the Zacks Consensus Estimate of 10 cents. The strong quarterly earnings were backed by higher activity levels in all the service lines and improved pricing.

RPC 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 Growth and Value. RES is expected to see earnings growth of 116.2% for 2022.

BP plc (BP - Free Report) reported second-quarter 2022 adjusted earnings of $2.61 per American Depositary Share on a replacement-cost basis, excluding non-operating items. The bottom line beat the Zacks Consensus Estimate of earnings of $2.20 per share on higher production and commodity price realizations.

BP 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 Growth and Value. BP is expected to see earnings growth of 116.2% for 2022.

PBF Energy Inc. (PBF - Free Report) reported second-quarter earnings of $10.58 per share, comfortably beating the Zacks Consensus Estimate of earnings of $7.36. The strong quarterly results were driven by increased contributions from the Refining segment.

PBF Energy 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. PBF is expected to see earnings growth of 764.4% in 2022.


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