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SM Energy (SM) Q4 Earnings Top Estimates, Revenues Decline Y/Y
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SM Energy Company (SM - Free Report) reported fourth-quarter 2023 adjusted earnings of $1.56 per share, which surpassed the Zacks Consensus Estimate of $1.39. The bottom line increased from the year-ago quarter’s earnings of $1.29 per share.
Total quarterly revenues of $608.7 million declined from $671.3 million in the year-ago quarter and missed the Zacks Consensus Estimate of $612 million.
Strong quarterly earnings resulted from higher oil equivalent production volumes and declining hydrocarbon production expenses.
SM Energy Company Price, Consensus and EPS Surprise
SM Energy’s fourth-quarter production totaled 153.5 thousand barrels of oil equivalent per day (MBoe/d) (almost 43% oil), up 7% from the year-ago level of 142.9 MBoe/d. The reported figure marginally outpaced the Zacks Consensus Estimate of 153 MBoe/d.
Oil production of SM Energy increased 6% year over year to 66 thousand barrels per day (MBbls/d) and surpassed the Zacks Consensus Estimate of 65 MBbls/d.
The company produced 364.1 million cubic feet per day of natural gas in the quarter, up 4% year over year. Natural gas liquids contributed 26.7 MBbls/d to the total production volume, which jumped 18%.
Realized Prices
Before the effects of derivative settlements, the average realized price per Boe was $42.99 compared with $50.92 in the year-ago quarter. The average realized oil price plunged 6% to $77.41 per barrel. The Zacks Consensus Estimate of $80 per barrel for oil price also reflects a year-over-year decline.
The average realized price of natural gas declined 45% year over year to $2.47 per thousand cubic feet, while that for natural gas liquids fell 16% to $21.92 per barrel.
Costs & Expenses
On the cost front, unit lease operating expenses of SM Energy increased 2% year over year to $5.31 per Boe. General and administrative expenses increased 4% to $2.60 per Boe from the prior year's $2.50. Transportation expenses slipped 27% to $2.08 per Boe.
Total hydrocarbon production expenses of SM Energy in the quarter were $137.3 million compared with the year-ago level of $150.7 million. Total exploration expenses were $15.8 million, higher than the year-ago figure of $10.8 million.
Capex
The capital expenditure of SM Energy in the December-end quarter was $222.7 million. It generated an adjusted free cash flow of $156 million in the reported quarter.
Balance Sheet
As of Dec 31, 2023, SM Energy had cash and cash equivalents of $616.2 million. It had a net debt of $969 million at the fourth-quarter end.
Guidance
For the first quarter of 2024, SM Energy projects production of 13 MMBoe. Of the total production, oil will probably contribute 43-44%.
In 2024, the company anticipates net production volumes of 56-59 million barrels of oil equivalent (MMBoe), with oil comprising 44% of the total. This projection suggests a 3-4% year-over-year increase in production.
Zacks Rank & Stocks to Consider
Currently, SM Energy carries a Zacks Rank #3 (Hold).
Murphy USA Inc. (MUSA - Free Report) is a leading independent retailer of motor fuel and convenience merchandise in the United States.
The Zacks Consensus Estimate for MUSA’s 2024 EPS is pegged at $25.36. It has a Zacks Style Score of A for Growth and Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Oceaneering International, Inc. (OII - Free Report) is one of the leading suppliers of offshore equipment and technology solutions to the energy industry.
The Zacks Consensus Estimate for OII’s 2024 EPS is pegged at $1.52. It has a Zacks Style Score of A for Growth and B for Value. OII’s earnings for 2024 are expected to surge 76.4% year over year.
Subsea 7 S.A. (SUBCY - Free Report) helps build underwater oil and gas fields. It is a top player in the Oil and Gas Equipment and Services market, which is expected to grow as oil and gas production moves further offshore.
The Zacks Consensus Estimate for SUBCY’s 2024 EPS is pegged at 91 cents. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days. SUBCY’s 2024 earnings are expected to soar 277% year over year.
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SM Energy (SM) Q4 Earnings Top Estimates, Revenues Decline Y/Y
SM Energy Company (SM - Free Report) reported fourth-quarter 2023 adjusted earnings of $1.56 per share, which surpassed the Zacks Consensus Estimate of $1.39. The bottom line increased from the year-ago quarter’s earnings of $1.29 per share.
Total quarterly revenues of $608.7 million declined from $671.3 million in the year-ago quarter and missed the Zacks Consensus Estimate of $612 million.
Strong quarterly earnings resulted from higher oil equivalent production volumes and declining hydrocarbon production expenses.
SM Energy Company Price, Consensus and EPS Surprise
SM Energy Company price-consensus-eps-surprise-chart | SM Energy Company Quote
Operational Performance:
Production
SM Energy’s fourth-quarter production totaled 153.5 thousand barrels of oil equivalent per day (MBoe/d) (almost 43% oil), up 7% from the year-ago level of 142.9 MBoe/d. The reported figure marginally outpaced the Zacks Consensus Estimate of 153 MBoe/d.
Oil production of SM Energy increased 6% year over year to 66 thousand barrels per day (MBbls/d) and surpassed the Zacks Consensus Estimate of 65 MBbls/d.
The company produced 364.1 million cubic feet per day of natural gas in the quarter, up 4% year over year. Natural gas liquids contributed 26.7 MBbls/d to the total production volume, which jumped 18%.
Realized Prices
Before the effects of derivative settlements, the average realized price per Boe was $42.99 compared with $50.92 in the year-ago quarter. The average realized oil price plunged 6% to $77.41 per barrel. The Zacks Consensus Estimate of $80 per barrel for oil price also reflects a year-over-year decline.
The average realized price of natural gas declined 45% year over year to $2.47 per thousand cubic feet, while that for natural gas liquids fell 16% to $21.92 per barrel.
Costs & Expenses
On the cost front, unit lease operating expenses of SM Energy increased 2% year over year to $5.31 per Boe. General and administrative expenses increased 4% to $2.60 per Boe from the prior year's $2.50. Transportation expenses slipped 27% to $2.08 per Boe.
Total hydrocarbon production expenses of SM Energy in the quarter were $137.3 million compared with the year-ago level of $150.7 million. Total exploration expenses were $15.8 million, higher than the year-ago figure of $10.8 million.
Capex
The capital expenditure of SM Energy in the December-end quarter was $222.7 million. It generated an adjusted free cash flow of $156 million in the reported quarter.
Balance Sheet
As of Dec 31, 2023, SM Energy had cash and cash equivalents of $616.2 million. It had a net debt of $969 million at the fourth-quarter end.
Guidance
For the first quarter of 2024, SM Energy projects production of 13 MMBoe. Of the total production, oil will probably contribute 43-44%.
In 2024, the company anticipates net production volumes of 56-59 million barrels of oil equivalent (MMBoe), with oil comprising 44% of the total. This projection suggests a 3-4% year-over-year increase in production.
Zacks Rank & Stocks to Consider
Currently, SM Energy carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at the following companies that presently carry a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Murphy USA Inc. (MUSA - Free Report) is a leading independent retailer of motor fuel and convenience merchandise in the United States.
The Zacks Consensus Estimate for MUSA’s 2024 EPS is pegged at $25.36. It has a Zacks Style Score of A for Growth and Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Oceaneering International, Inc. (OII - Free Report) is one of the leading suppliers of offshore equipment and technology solutions to the energy industry.
The Zacks Consensus Estimate for OII’s 2024 EPS is pegged at $1.52. It has a Zacks Style Score of A for Growth and B for Value. OII’s earnings for 2024 are expected to surge 76.4% year over year.
Subsea 7 S.A. (SUBCY - Free Report) helps build underwater oil and gas fields. It is a top player in the Oil and Gas Equipment and Services market, which is expected to grow as oil and gas production moves further offshore.
The Zacks Consensus Estimate for SUBCY’s 2024 EPS is pegged at 91 cents. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days. SUBCY’s 2024 earnings are expected to soar 277% year over year.