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Magnolia Oil & Gas Corp (MGY) Up 12.5% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Magnolia Oil & Gas Corp (MGY - Free Report) . Shares have added about 12.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Magnolia Oil & Gas Corp due for a pullback? 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.
Magnolia Q4 Earnings Miss Estimates
Magnolia Oil & Gas reported a fourth-quarter 2023 adjusted net income of 50 cents per share, which missed the Zacks Consensus Estimate of 54 cents. The bottom line also deteriorated from the year-ago quarter’s level of 86 cents due to a decline in commodity prices.
Total revenues came in at $322.6 million, which missed the Zacks Consensus Estimate of $325 million. The top line also declined 4.9% from $349 million recorded in the year-ago period.
The company repurchased 2.5 million of its Class A common shares for $54.2 million in the reported quarter.
Production & Prices
The average daily total output of 85,414 barrels of oil equivalent per day (boe/d) increased from the year-ago quarter’s figure of 73,785 boe/d.The figure also beat our estimate of 85,000 boe/d. Oil and gas production increased 15.8% year over year. Oil volumes totaled 35,466 barrels per day (bpd), up 9.8% from that reported in the fourth quarter of 2022. However, the figure missed our estimate of 36,500 bpd.
The average realized crude oil price was $77.39 per barrel, indicating a 6.2% decline from the year-ago period’s level of $82.53. The average realized natural gas liquids price was $19.69 per barrel, implying a 22.6% deterioration from the year-ago period’s figure. Natural gas price decreased 61.2% year over year to $1.85 per thousand cubic feet. MGY recorded $41.06 per boe compared with $51.42 a year ago.
Balance Sheet & Capital Expenditure
As of Dec 31, Magnolia had cash and cash equivalents of $401.1 million and long-term debt of $392.8 million. The total debt-to-total capital was 17.3%.
The company spent $91.5 million on its capital program in the reported quarter. Operating expenses increased to $184.5 million from $151.1 million in the year-ago period.
Guidance
Magnolia expects to spend between $450 million and $480 million on D&C capital in 2024. The company anticipates first-quarter D&C capital expenditures to be around $130 million, which will be the highest quarterly rate of spending in 2024.
Total production for the first quarter is expected to be in the range of 84-85 Mboe/d, including several days of production and facility downtime caused by severe winter weather in mid-January.
MGY plans to offer a discount of $3.00 per barrel to Magellan East Houston, leaving it unhedged for all oil and natural gas production.
The company expects the diluted share count to be around 205 million in the first quarter of 2024, which is 4% lower than that in the year-ago period.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -15.62% due to these changes.
VGM Scores
At this time, Magnolia Oil & Gas Corp 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 B on the value side, putting it in the second quintile 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 these revisions indicates a downward shift. Notably, Magnolia Oil & Gas Corp has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Magnolia Oil & Gas Corp (MGY) Up 12.5% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Magnolia Oil & Gas Corp (MGY - Free Report) . Shares have added about 12.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Magnolia Oil & Gas Corp due for a pullback? 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.
Magnolia Q4 Earnings Miss Estimates
Magnolia Oil & Gas reported a fourth-quarter 2023 adjusted net income of 50 cents per share, which missed the Zacks Consensus Estimate of 54 cents. The bottom line also deteriorated from the year-ago quarter’s level of 86 cents due to a decline in commodity prices.
Total revenues came in at $322.6 million, which missed the Zacks Consensus Estimate of $325 million. The top line also declined 4.9% from $349 million recorded in the year-ago period.
The company repurchased 2.5 million of its Class A common shares for $54.2 million in the reported quarter.
Production & Prices
The average daily total output of 85,414 barrels of oil equivalent per day (boe/d) increased from the year-ago quarter’s figure of 73,785 boe/d.The figure also beat our estimate of 85,000 boe/d.
Oil and gas production increased 15.8% year over year. Oil volumes totaled 35,466 barrels per day (bpd), up 9.8% from that reported in the fourth quarter of 2022. However, the figure missed our estimate of 36,500 bpd.
The average realized crude oil price was $77.39 per barrel, indicating a 6.2% decline from the year-ago period’s level of $82.53. The average realized natural gas liquids price was $19.69 per barrel, implying a 22.6% deterioration from the year-ago period’s figure. Natural gas price decreased 61.2% year over year to $1.85 per thousand cubic feet. MGY recorded $41.06 per boe compared with $51.42 a year ago.
Balance Sheet & Capital Expenditure
As of Dec 31, Magnolia had cash and cash equivalents of $401.1 million and long-term debt of $392.8 million. The total debt-to-total capital was 17.3%.
The company spent $91.5 million on its capital program in the reported quarter. Operating expenses increased to $184.5 million from $151.1 million in the year-ago period.
Guidance
Magnolia expects to spend between $450 million and $480 million on D&C capital in 2024. The company anticipates first-quarter D&C capital expenditures to be around $130 million, which will be the highest quarterly rate of spending in 2024.
Total production for the first quarter is expected to be in the range of 84-85 Mboe/d, including several days of production and facility downtime caused by severe winter weather in mid-January.
MGY plans to offer a discount of $3.00 per barrel to Magellan East Houston, leaving it unhedged for all oil and natural gas production.
The company expects the diluted share count to be around 205 million in the first quarter of 2024, which is 4% lower than that in the year-ago period.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -15.62% due to these changes.
VGM Scores
At this time, Magnolia Oil & Gas Corp 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 B on the value side, putting it in the second quintile 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 these revisions indicates a downward shift. Notably, Magnolia Oil & Gas Corp has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.