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Enbridge (ENB) Q2 Earnings In Line, Revenues Fall Y/Y
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Enbridge Inc. (ENB - Free Report) reported second-quarter 2023 adjusted earnings per share of 51 cents, which was on par with the Zacks Consensus Estimate. However, the bottom line declined from the year-ago quarter’s level of 53 cents.
Total quarterly revenues of $7,767 million moved down from $10,355 million in the prior-year quarter. However, the top line beat the Zacks Consensus Estimate of $7,493 million.
The in-line quarterly earnings resulted from higher contributions from the Liquids Pipelines segment. This was partially offset by lower contributions from the Gas Transmission and Midstream, and Gas Distribution and Storage segments.
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$2,471 million, up from C$2,095 million in the year-earlier quarter. Higher contributions from Mainline System, Gulf Coast and Mid-Continent primarily aided the segment.
Gas Transmission and Midstream: Adjusted earnings for this segment totaled C$1,033 million, down from C$1,084 million recorded in second-quarter 2022. Lower contributions from the Midstream and Canadian Gas Transmission primarily hurt its performance. The reported figure came in higher than our estimate of C$1012.4 million.
Gas Distribution and Storage: The unit generated a profit of C$367 million, down from C$422 million in the prior-year quarter due to decreased contributions from Enbridge Gas Inc. The figure was also lower than our estimate of C$409.3 million.
Renewable Power Generation: The segment recorded earnings of C$132 million, up from C$127 million in the prior-year quarter. This outperformance was primarily due to contributions from the Saint-Nazaire Offshore Wind Project, which reached full operating capacity in December 2022. The figure was also higher than our estimate of C$116.5 million.
Energy Services: The segment incurred a loss of C$30 million, narrower than a loss of C$99 million recorded in the second quarter of 2022.
Distributable Cash Flow (DCF)
In second-quarter 2023, Enbridge reported a DCF of C$2,783 million, up from C$2,747 million recorded a year ago.
Balance Sheet
At the end of the second quarter, ENB reported long-term debt of C$72,530 million. It had cash and cash equivalents of C$1030 million. The current portion of long-term debt was C$6,086 million.
Guidance
For 2023, Enbridge reiterated its EBITDA guidance in the range of C$15.9-C$16.5 billion. The metric indicates an increase from C$12 billion reported in 2022. The company expects DCF per share of C$5.25-C$5.65 for the year, the mid-point of which implies an increase from C$5.42 registered in 2022.
Zacks Rank & Stocks to Consider
Currently, ENB carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy space are Murphy USA Inc. (MUSA - Free Report) , Evolution Petroleum Corporation (EPM - Free Report) , and Crestwood Equity Partners LP . While MUSA sports a Zacks Rank #1 (Strong Buy), both EPM and CEQP carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Murphy USA serves 1.6 million customers daily and owns a dedicated line on the Colonial Pipeline. It operates stations near Walmart supercenters and is a low-cost, high-volume fuel seller. This enables the company to attract significantly more transactions than its peers.
Evolution Petroleum is touted as a key independent energy player through its ownership interests in onshore oil and natural gas properties in the United States.
Headquartered in Houston, TX, Crestwood is a master limited partnership that provides a wide range of fee-based infrastructure solutions in major U.S. shale plays like the Bakken Shale, Delaware Basin, Powder River Basin, Marcellus Shale and others. The company is least exposed to commodity price fluctuations since it generates stable fee-based revenues from diverse midstream energy assets via long-term contracts.
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Enbridge (ENB) Q2 Earnings In Line, Revenues Fall Y/Y
Enbridge Inc. (ENB - Free Report) reported second-quarter 2023 adjusted earnings per share of 51 cents, which was on par with the Zacks Consensus Estimate. However, the bottom line declined from the year-ago quarter’s level of 53 cents.
Total quarterly revenues of $7,767 million moved down from $10,355 million in the prior-year quarter. However, the top line beat the Zacks Consensus Estimate of $7,493 million.
The in-line quarterly earnings resulted from higher contributions from the Liquids Pipelines segment. This was partially offset by lower contributions from the Gas Transmission and Midstream, and Gas Distribution and Storage segments.
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$2,471 million, up from C$2,095 million in the year-earlier quarter. Higher contributions from Mainline System, Gulf Coast and Mid-Continent primarily aided the segment.
Gas Transmission and Midstream: Adjusted earnings for this segment totaled C$1,033 million, down from C$1,084 million recorded in second-quarter 2022. Lower contributions from the Midstream and Canadian Gas Transmission primarily hurt its performance. The reported figure came in higher than our estimate of C$1012.4 million.
Gas Distribution and Storage: The unit generated a profit of C$367 million, down from C$422 million in the prior-year quarter due to decreased contributions from Enbridge Gas Inc. The figure was also lower than our estimate of C$409.3 million.
Renewable Power Generation: The segment recorded earnings of C$132 million, up from C$127 million in the prior-year quarter. This outperformance was primarily due to contributions from the Saint-Nazaire Offshore Wind Project, which reached full operating capacity in December 2022. The figure was also higher than our estimate of C$116.5 million.
Energy Services: The segment incurred a loss of C$30 million, narrower than a loss of C$99 million recorded in the second quarter of 2022.
Distributable Cash Flow (DCF)
In second-quarter 2023, Enbridge reported a DCF of C$2,783 million, up from C$2,747 million recorded a year ago.
Balance Sheet
At the end of the second quarter, ENB reported long-term debt of C$72,530 million. It had cash and cash equivalents of C$1030 million. The current portion of long-term debt was C$6,086 million.
Guidance
For 2023, Enbridge reiterated its EBITDA guidance in the range of C$15.9-C$16.5 billion. The metric indicates an increase from C$12 billion reported in 2022. The company expects DCF per share of C$5.25-C$5.65 for the year, the mid-point of which implies an increase from C$5.42 registered in 2022.
Zacks Rank & Stocks to Consider
Currently, ENB carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy space are Murphy USA Inc. (MUSA - Free Report) , Evolution Petroleum Corporation (EPM - Free Report) , and Crestwood Equity Partners LP . While MUSA sports a Zacks Rank #1 (Strong Buy), both EPM and CEQP carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Murphy USA serves 1.6 million customers daily and owns a dedicated line on the Colonial Pipeline. It operates stations near Walmart supercenters and is a low-cost, high-volume fuel seller. This enables the company to attract significantly more transactions than its peers.
Evolution Petroleum is touted as a key independent energy player through its ownership interests in onshore oil and natural gas properties in the United States.
Headquartered in Houston, TX, Crestwood is a master limited partnership that provides a wide range of fee-based infrastructure solutions in major U.S. shale plays like the Bakken Shale, Delaware Basin, Powder River Basin, Marcellus Shale and others. The company is least exposed to commodity price fluctuations since it generates stable fee-based revenues from diverse midstream energy assets via long-term contracts.