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Southwest Gas (SWX) Up 9.6% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Southwest Gas (SWX - Free Report) . Shares have added about 9.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Southwest 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 its most recent earnings report in order to get a better handle on the important drivers.
Southwest Gas Q1 Earnings & Revenues Outpace Estimates
Southwest Gas Holdings Inc. recorded first-quarter 2023 operating earnings of $1.69 per share, which beat the Zacks Consensus Estimate of $1.39 by 21.6%. The bottom line decreased 2.9% from the year-ago quarter’s $1.74.
GAAP earnings were 67 cents per share compared with $1.58 in the prior-year period.
Total Revenues
Operating revenues totaled $1,603.3 million for the quarter, which outpaced the Zacks Consensus Estimate of $1,290 million by 24.3%. The top line improved 26.5% from $1,267.4 million in the prior-year quarter.
Highlights of the Release
Total operating expenses were $1,468.1 million, up 33.6% from $1,098.9 million in the comparable period of 2022. This increase was due to a hike in the net cost of gas sold and utility infrastructure services expenses.
Total operating income amounted to $135.2 million, down 19.8% from the year-ago quarter’s $168.5 million.
Financial Highlights
Cash and cash equivalents, as of Mar 31, 2023, were $82.1 million compared with $123.1 million as of Dec 31, 2022.
The long-term debt, less current maturities, amounted to $4,577.6 million as of Mar 31, 2023, compared with $4,403.3 million as of Dec 31, 2022.
Southwest Gas’ net cash used in operating activities was $185.7 million against $186.6 million cash provided in the year-ago period.
2023 Guidance
The Natural Gas Distribution segment expects 2023 capital expenditure of $665-$685 million, in support of customer growth, system improvements and pipe replacement programs. For 2023-2025, capital expenditure is expected to be $2 billion. The segment predicts net income of $205-$215 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -20.41% due to these changes.
VGM Scores
Currently, Southwest Gas has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, 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
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Southwest Gas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Southwest Gas belongs to the Zacks Utility - Gas Distribution industry. Another stock from the same industry, National Fuel Gas (NFG - Free Report) , has gained 0.2% over the past month. More than a month has passed since the company reported results for the quarter ended March 2023.
National Fuel Gas reported revenues of $717.26 million in the last reported quarter, representing a year-over-year change of +2.2%. EPS of $1.54 for the same period compares with $1.68 a year ago.
National Fuel Gas is expected to post earnings of $0.96 per share for the current quarter, representing a year-over-year change of -37.7%. Over the last 30 days, the Zacks Consensus Estimate has changed +5.9%.
National Fuel Gas has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.
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Southwest Gas (SWX) Up 9.6% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Southwest Gas (SWX - Free Report) . Shares have added about 9.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Southwest 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 its most recent earnings report in order to get a better handle on the important drivers.
Southwest Gas Q1 Earnings & Revenues Outpace Estimates
Southwest Gas Holdings Inc. recorded first-quarter 2023 operating earnings of $1.69 per share, which beat the Zacks Consensus Estimate of $1.39 by 21.6%. The bottom line decreased 2.9% from the year-ago quarter’s $1.74.
GAAP earnings were 67 cents per share compared with $1.58 in the prior-year period.
Total Revenues
Operating revenues totaled $1,603.3 million for the quarter, which outpaced the Zacks Consensus Estimate of $1,290 million by 24.3%. The top line improved 26.5% from $1,267.4 million in the prior-year quarter.
Highlights of the Release
Total operating expenses were $1,468.1 million, up 33.6% from $1,098.9 million in the comparable period of 2022. This increase was due to a hike in the net cost of gas sold and utility infrastructure services expenses.
Total operating income amounted to $135.2 million, down 19.8% from the year-ago quarter’s $168.5 million.
Financial Highlights
Cash and cash equivalents, as of Mar 31, 2023, were $82.1 million compared with $123.1 million as of Dec 31, 2022.
The long-term debt, less current maturities, amounted to $4,577.6 million as of Mar 31, 2023, compared with $4,403.3 million as of Dec 31, 2022.
Southwest Gas’ net cash used in operating activities was $185.7 million against $186.6 million cash provided in the year-ago period.
2023 Guidance
The Natural Gas Distribution segment expects 2023 capital expenditure of $665-$685 million, in support of customer growth, system improvements and pipe replacement programs. For 2023-2025, capital expenditure is expected to be $2 billion. The segment predicts net income of $205-$215 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -20.41% due to these changes.
VGM Scores
Currently, Southwest Gas has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, 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
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Southwest Gas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Southwest Gas belongs to the Zacks Utility - Gas Distribution industry. Another stock from the same industry, National Fuel Gas (NFG - Free Report) , has gained 0.2% over the past month. More than a month has passed since the company reported results for the quarter ended March 2023.
National Fuel Gas reported revenues of $717.26 million in the last reported quarter, representing a year-over-year change of +2.2%. EPS of $1.54 for the same period compares with $1.68 a year ago.
National Fuel Gas is expected to post earnings of $0.96 per share for the current quarter, representing a year-over-year change of -37.7%. Over the last 30 days, the Zacks Consensus Estimate has changed +5.9%.
National Fuel Gas has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.