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NuStar Energy (NS) Q4 Earnings & Revenues Outpace Estimates
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NuStar Energy L.P. (NS - Free Report) reported fourth-quarter 2023 adjusted earnings per unit of 37 cents, which beat the Zacks Consensus Estimate of 26 cents and improved significantly from the year-ago figure of 34 cents. The impressive performance can be attributed to strong contributions from the Storage segment.
NuStar Energy reported revenues of $451.7 million, which also beat the consensus mark of $362 million and edged up 5% year over year. Operating profit totaled $132.1 million compared with $129.4 million in the corresponding period of 2022.
NuStar Energy L.P. Price, Consensus and EPS Surprise
Pipeline: Quarterly throughput volumes totaled 1,917,775 barrels per day (Bbl/d), down 5.2% from the year-ago period’s level of 2,021,977 Bbl/d. Throughput volumes from crude oil pipelines reduced about 7.1% from the year-ago level to 1,299,866 Bbl/d and the same from refined product pipelines increased to 617,909 Bbl/d from 611,011 Bbl/d in the prior-year quarter.
NuStar Energy's Permian Crude System throughput volumes totaled 1,299,866 Bbl/d, down from the year-ago quarter’s figure of 1,410,966 Bbl/d. The segment’s revenues decreased 0.6% year over year to $228.6 million. The top line beat our projection of $193.5 million.
The Pipeline unit recorded an operating profit of $130 million compared with $132 million in the prior-year period. The figure beat our estimate of $99.3 million.
Storage: Throughput volumes for the segment decreased to 489,206 Bbl/d from 512,504 Bbl/d in the year-ago quarter.
Total revenues increased 7.5% year over year to $85.5 million due to higher Throughput terminal revenues. The figure also beat our projection of $69.5 billion. Throughput terminal revenues increased from $26.3 million to $31.5 million year over year.
Operating profit totaled $26.3 million compared with $22.2 million in the year-ago quarter. The figure beat our projection of $23.6 million.
Fuels Marketing: Product sales increased to $137.5 million from $120.6 million in the year-ago quarter. The figure also beat our projection of $93.4 billion. The cost of goods also increased about 16.2% from $107.9 million registered a year ago.
Operating earnings totaled $11.7 million compared with $11.8 million in the corresponding quarter of 2022. However, the figure fell short of our estimate of $32.9 billion.
Cash Flow, Debt and Financial Position
Distributable cash flow available to limited partners totaled $87.3 million (providing 1.73x adjusted distribution coverage) for the reported quarter. A coverage ratio of more than one implies that NuStar Energy has generated enough cash to cover its distribution.
As of Dec 31, the partnership’s long-term debt was $4.4 billion. NuStar continues to improve its debt-to-EBITDA ratio to 3.85x in the fourth quarter (compared with 3.98x a year ago).
Guidance
NS expects net income in the range of $220-$260 million for full-year 2024. It also anticipates adjusted EBITDA in the band of $720-$780 million for the same time frame.
The company expects to close its merger with Sunoco LP as early as the second quarter of 2024.
Subsea 7 is valued at $4.07 billion. The company currently pays a dividend of 38 cents per share, or 2.87%, on an annual basis.
SUBCY offers offshore project services for the energy industry, specializing in subsea field development, covering project management, design, engineering, procurement, fabrication, survey, installation and commissioning of seabed production facilities.
Energy Transfer is valued at $45.76 billion. The company currently pays a dividend of $1.26 per share, or 8.66%, on an annual basis.
ET is an independent energy company, principally engaged in the acquisition, exploration, development and production of crude oil and natural gas.
Murphy USA is valued at around $8.47 billion. In the past year, its shares have risen 45.2%.
MUSA is involved in the marketing of retail motor fuel products and convenience merchandise, operating retail stores under the brands Murphy USA, Murphy Express and QuickChek.
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NuStar Energy (NS) Q4 Earnings & Revenues Outpace Estimates
NuStar Energy L.P. (NS - Free Report) reported fourth-quarter 2023 adjusted earnings per unit of 37 cents, which beat the Zacks Consensus Estimate of 26 cents and improved significantly from the year-ago figure of 34 cents. The impressive performance can be attributed to strong contributions from the Storage segment.
NuStar Energy reported revenues of $451.7 million, which also beat the consensus mark of $362 million and edged up 5% year over year. Operating profit totaled $132.1 million compared with $129.4 million in the corresponding period of 2022.
NuStar Energy L.P. Price, Consensus and EPS Surprise
NuStar Energy L.P. price-consensus-eps-surprise-chart | NuStar Energy L.P. Quote
Segmental Updates
Pipeline: Quarterly throughput volumes totaled 1,917,775 barrels per day (Bbl/d), down 5.2% from the year-ago period’s level of 2,021,977 Bbl/d. Throughput volumes from crude oil pipelines reduced about 7.1% from the year-ago level to 1,299,866 Bbl/d and the same from refined product pipelines increased to 617,909 Bbl/d from 611,011 Bbl/d in the prior-year quarter.
NuStar Energy's Permian Crude System throughput volumes totaled 1,299,866 Bbl/d, down from the year-ago quarter’s figure of 1,410,966 Bbl/d. The segment’s revenues decreased 0.6% year over year to $228.6 million. The top line beat our projection of $193.5 million.
The Pipeline unit recorded an operating profit of $130 million compared with $132 million in the prior-year period. The figure beat our estimate of $99.3 million.
Storage: Throughput volumes for the segment decreased to 489,206 Bbl/d from 512,504 Bbl/d in the year-ago quarter.
Total revenues increased 7.5% year over year to $85.5 million due to higher Throughput terminal revenues. The figure also beat our projection of $69.5 billion. Throughput terminal revenues increased from $26.3 million to $31.5 million year over year.
Operating profit totaled $26.3 million compared with $22.2 million in the year-ago quarter. The figure beat our projection of $23.6 million.
Fuels Marketing: Product sales increased to $137.5 million from $120.6 million in the year-ago quarter. The figure also beat our projection of $93.4 billion. The cost of goods also increased about 16.2% from $107.9 million registered a year ago.
Operating earnings totaled $11.7 million compared with $11.8 million in the corresponding quarter of 2022. However, the figure fell short of our estimate of $32.9 billion.
Cash Flow, Debt and Financial Position
Distributable cash flow available to limited partners totaled $87.3 million (providing 1.73x adjusted distribution coverage) for the reported quarter. A coverage ratio of more than one implies that NuStar Energy has generated enough cash to cover its distribution.
As of Dec 31, the partnership’s long-term debt was $4.4 billion. NuStar continues to improve its debt-to-EBITDA ratio to 3.85x in the fourth quarter (compared with 3.98x a year ago).
Guidance
NS expects net income in the range of $220-$260 million for full-year 2024. It also anticipates adjusted EBITDA in the band of $720-$780 million for the same time frame.
The company expects to close its merger with Sunoco LP as early as the second quarter of 2024.
Zacks Rank and Key Picks
Currently, NS carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at some better-ranked stocks like Subsea 7 S.A. (SUBCY - Free Report) and Energy Transfer LP (ET - Free Report) , both sporting a Zacks Rank #1 (Strong Buy), and Murphy USA Inc. (MUSA - Free Report) , carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Subsea 7 is valued at $4.07 billion. The company currently pays a dividend of 38 cents per share, or 2.87%, on an annual basis.
SUBCY offers offshore project services for the energy industry, specializing in subsea field development, covering project management, design, engineering, procurement, fabrication, survey, installation and commissioning of seabed production facilities.
Energy Transfer is valued at $45.76 billion. The company currently pays a dividend of $1.26 per share, or 8.66%, on an annual basis.
ET is an independent energy company, principally engaged in the acquisition, exploration, development and production of crude oil and natural gas.
Murphy USA is valued at around $8.47 billion. In the past year, its shares have risen 45.2%.
MUSA is involved in the marketing of retail motor fuel products and convenience merchandise, operating retail stores under the brands Murphy USA, Murphy Express and QuickChek.