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Why Is Antero Resources (AR) Down 14.9% Since Last Earnings Report?
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It has been about a month since the last earnings report for Antero Resources (AR - Free Report) . Shares have lost about 14.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Antero Resources due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Antero Q3 Earnings Beat Estimates, Revenues Fall Y/Y
Antero Resources Corporation reported third-quarter 2023 adjusted earnings of 8 cents per share, which beat the Zacks Consensus Estimate of a loss of 2 cents. However, the bottom line declined significantly from the year-ago quarter’s level of $1.63.
Total quarterly revenues of $1,126 million missed the Zacks Consensus Estimate of $1,136 million. Also, the top line decreased significantly from the year-ago quarter’s figure of $2,065 million.
The better-than-expected quarterly earnings can be primarily attributed to higher volumes, driven by strong well performance and lower operating expenses. However, a substantial decline in commodity price realization offset the positives.
Overall Production
Total production through the third quarter was 320 billion cubic feet equivalent (Bcfe), up 9% from 294 Bcfe recorded a year ago. The reported figure came in higher than our estimate of 311 Bcfe. Natural gas production (accounting for 65% of the total output) totaled 208 Bcf, higher than our estimate of 207 Bcf.
Oil production in the quarter amounted to 918 thousand barrels (MBbls), up 14% from 804 MBbls registered in the year-ago period.
AR reported production of 6,696 MBbls of C2 Ethane, up 34% from 5,010 MBbls recorded a year ago. Our estimate for the same was pinned at 6,685 MBbls. The company’s output of 10,977 MBbls of C3+ NGLs was 10% higher than 9,950 MBbls reported in the year-ago period. The figure also came in higher than our estimate of 10,381 MBbls.
Weighted natural-gas-equivalent price realization in the quarter was $3.32 per thousand cubic feet equivalent (Mcfe), lower than the year-ago quarter’s figure of $8.23. Our estimate for the same was pegged at $3.08 Mcfe. Realized prices for natural gas declined 71% to $2.48 per Mcf from $8.69 recorded a year ago. The figure was also lower than our estimate of $2.82 per Mcf.
The company’s oil price realization in the quarter was $68.22 per barrel (Bbl), down 18% from $83.41 registered a year ago. The figure was also lower than our estimate of $69.92 per Bbl. The realized price for C3+ NGLs declined to $36.81 per Bbl from $50.61. The realized price for C2 Ethane decreased 50% to $11.73 per Bbl from $23.40 recorded a year ago. The figure was lower than our estimate of $15.45 per Bbl.
Operating Expenses
Total operating expenses decreased to $1,070.4 million from $1,290.5 million reported in the year-ago period. Our estimate for the same was pinned at $1,028.3 million.
However, the average lease operating cost was 10 cents per Mcfe, up 11% from 9 cents recorded in the year-ago period. The gathering and compression costs decreased 16% year over year to 68 cents per Mcfe.
Transportation expenses declined 25% from the prior-year quarter’s level to 60 cents per Mcfe, while processing costs increased 1% to 83 cents per Mcfe during the same time frame.
Capex & Financials
In the third quarter, Antero spent $231 million on drilling and completion operations. As of Sep 30, 2023, it had no cash and cash equivalents. It had a long-term debt of $1.61 billion as of the same date.
Guidance
For 2023, Antero raised its projection for net daily natural gas-equivalent production to the range of 3.39-3.41 Bcfe/d. The company also anticipated a decline in realized natural gas price to flat to NYMEX Henry Hub. It decreased the high end of its cash production expense guidance by $0.05 per Mcfe to $2.35-$2.40. The company also lowered the projected net marketing expense to a range of $0.05-$0.07 per Mcfe.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 17.78% due to these changes.
VGM Scores
Currently, Antero Resources has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Antero Resources has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Antero Resources (AR) Down 14.9% Since Last Earnings Report?
It has been about a month since the last earnings report for Antero Resources (AR - Free Report) . Shares have lost about 14.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Antero Resources due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Antero Q3 Earnings Beat Estimates, Revenues Fall Y/Y
Antero Resources Corporation reported third-quarter 2023 adjusted earnings of 8 cents per share, which beat the Zacks Consensus Estimate of a loss of 2 cents. However, the bottom line declined significantly from the year-ago quarter’s level of $1.63.
Total quarterly revenues of $1,126 million missed the Zacks Consensus Estimate of $1,136 million. Also, the top line decreased significantly from the year-ago quarter’s figure of $2,065 million.
The better-than-expected quarterly earnings can be primarily attributed to higher volumes, driven by strong well performance and lower operating expenses. However, a substantial decline in commodity price realization offset the positives.
Overall Production
Total production through the third quarter was 320 billion cubic feet equivalent (Bcfe), up 9% from 294 Bcfe recorded a year ago. The reported figure came in higher than our estimate of 311 Bcfe. Natural gas production (accounting for 65% of the total output) totaled 208 Bcf, higher than our estimate of 207 Bcf.
Oil production in the quarter amounted to 918 thousand barrels (MBbls), up 14% from 804 MBbls registered in the year-ago period.
AR reported production of 6,696 MBbls of C2 Ethane, up 34% from 5,010 MBbls recorded a year ago. Our estimate for the same was pinned at 6,685 MBbls. The company’s output of 10,977 MBbls of C3+ NGLs was 10% higher than 9,950 MBbls reported in the year-ago period. The figure also came in higher than our estimate of 10,381 MBbls.
Realized Prices (Excluding Derivative Settlements)
Weighted natural-gas-equivalent price realization in the quarter was $3.32 per thousand cubic feet equivalent (Mcfe), lower than the year-ago quarter’s figure of $8.23. Our estimate for the same was pegged at $3.08 Mcfe. Realized prices for natural gas declined 71% to $2.48 per Mcf from $8.69 recorded a year ago. The figure was also lower than our estimate of $2.82 per Mcf.
The company’s oil price realization in the quarter was $68.22 per barrel (Bbl), down 18% from $83.41 registered a year ago. The figure was also lower than our estimate of $69.92 per Bbl. The realized price for C3+ NGLs declined to $36.81 per Bbl from $50.61. The realized price for C2 Ethane decreased 50% to $11.73 per Bbl from $23.40 recorded a year ago. The figure was lower than our estimate of $15.45 per Bbl.
Operating Expenses
Total operating expenses decreased to $1,070.4 million from $1,290.5 million reported in the year-ago period. Our estimate for the same was pinned at $1,028.3 million.
However, the average lease operating cost was 10 cents per Mcfe, up 11% from 9 cents recorded in the year-ago period. The gathering and compression costs decreased 16% year over year to 68 cents per Mcfe.
Transportation expenses declined 25% from the prior-year quarter’s level to 60 cents per Mcfe, while processing costs increased 1% to 83 cents per Mcfe during the same time frame.
Capex & Financials
In the third quarter, Antero spent $231 million on drilling and completion operations. As of Sep 30, 2023, it had no cash and cash equivalents. It had a long-term debt of $1.61 billion as of the same date.
Guidance
For 2023, Antero raised its projection for net daily natural gas-equivalent production to the range of 3.39-3.41 Bcfe/d. The company also anticipated a decline in realized natural gas price to flat to NYMEX Henry Hub. It decreased the high end of its cash production expense guidance by $0.05 per Mcfe to $2.35-$2.40. The company also lowered the projected net marketing expense to a range of $0.05-$0.07 per Mcfe.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 17.78% due to these changes.
VGM Scores
Currently, Antero Resources has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Antero Resources has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.