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Stone Energy (SGY) Swings to Profit in Q2, Revenues Fall Y/Y

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Oil and gas producer Stone Energy Corporation (SGY - Free Report) posted second-quarter 2017 profit of 33 cents per share (excluding non-recurring items), as against the Zacks Consensus Estimate of a loss of 9 cents. The improvement can be attributed to higher oil equivalent price realizations, which were partially offset by lower production and higher lease operating expenses. 

Total operating revenue fell to $77 million in the quarter from $89 million in the year-ago quarter.

Operational Highlights

During the quarter, production averaged 20.6 thousand barrels of oil equivalent per day (MBoe/D), compared with 29 MBoe/D in the second quarter of 2016. Of the total production, natural gas accounted for 23%, oil constituted 69% and natural gas liquids made up for the remaining 9%.

Overall realization, on a per Boe basis, was $38.04 in the reported quarter compared with $33.68 in second-quarter 2016. Natural gas price of $2.56 per Mcf was above $2.46 in the year-ago quarter. NGL price increased to $20.36 a barrel from $15.24 in the year-earlier quarter. Oil price was higher at $47.49 a barrel from $46.97 a year ago.

On the cost front, unit lease operating expenses increased to $8.88 per Boe from $7.13 in the year-earlier quarter. Depreciation, depletion and amortization were $17.22 per Boe compared with $17.08. Salaries, general and administrative expenses came in at $9.88 per Boe as compared with $7.58.

Price Performance

Stone Energy lost 15.9% in the April-to-June quarter of this year versus the 16.9% decline of its industry.   

Liquidity

As of Jun 30, 2017, Stone Energy had approximately $207.9 million in cash. The company had long-term debt of $235.7 million.

Zacks Rank & Key Picks

Stone Energy currently carries a Zacks Rank #3 (Hold). A few better-ranked players in the energy sector are TransCanada Corporation (TRP - Free Report) , Range Resources Corporation (RRC - Free Report) and Global Partners LP (GLP - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.   

TransCanada posted an average positive earnings surprise of 4.06% over the last four quarters.

Range Resources’ 2017 earnings are estimated to grow almost 116%.

Global Partners posted average positive earnings surprise of 415.30% over the last four quarters.

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