It has been about a month since the last earnings report for WPX Energy (WPX - Free Report) . Shares have added about 1.8% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is WPX due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
WPX Energy Earnings and Revenues Miss Estimates in Q4
WPX Energy Inc.’s fourth-quarter earnings of 2 cents per share lagged the Zacks Consensus Estimate of 5 cents by 60%. The reported earnings also turned around from a loss of 2 cents incurred in the year-ago quarter.
WPX Energy’s quarterly revenues of $544 million lagged the Zacks Consensus Estimate of $560 million by 2.9%. However, revenues improved 52.8% from $356 million recorded in the year-ago quarter.
Highlights of the Release
Total production in the fourth quarter was 156,400 barrels of oil equivalent per day, up 61% year over year. Liquids volumes accounted for nearly 78% of the total production, up from 59% in the year-ago comparable period, reflecting the company’s increasing focus on oil.
Oil production in the quarter was 96,000 barrels per day, which was nearly 49% higher than the year-ago level, courtesy of 55% increase in Delaware Basin and 44% growth in Williston Basin volumes over the past 12 months.
Total expenses were $497 million, up 68.5% from $295 million in the year-ago quarter.
Interest expenses in the reported quarter were $40 million, down 14.9% from $47 million in the prior-year period.
The company replaced its overall 2018 production at a rate of 308%, before consideration of divestitures.
Realized Prices & Hedges
Realized oil prices in the quarter were $52.05 per barrel, up 0.02% from the year-ago level.
Realized natural gas prices were $1.90 per thousand cubic feet, up 4.4% from a year ago. Realized prices for natural gas liquids were down 15.8% from the prior-year quarter to $20.14 per barrel.
For 2019, WPX Energy has 42,575 barrels per day of oil hedged at a weighted average price of $53.65 a barrel. The company also has 108,470 million British thermal units (MMBtu) per day of natural gas hedged at a weighted average price of $3.07 per MMBtu.
Cash and cash equivalents of WPX Energy as of Dec 31, 2018 were $3 million compared with $189 million at the end of 2017.
Its long-term debt as of Dec 31, 2018 was $2,485 million, down from the 2017-end level of $2,575 million.
Net cash from operating activities in 2018 was $883 million compared with $507 million recorded a year ago. Capital expenditure was $1,476 million compared with $1,161 million in the year-ago period.
WPX Energy expects total production guidance for 2019 in the range of 149-161 thousand barrels of oil equivalent per day (Mboe/d), out of which 63% is supposed to be oil. The midpoint of the guided range is 155 Mboe/d, which is 225% higher than the 2018 production level.
Capital expenditure for 2019 is expected in the range of $1,100-$1,275 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates flatlined during the past month.
Currently, WPX has a great Growth Score of A, a grade with the same score on the momentum front. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
WPX has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.