A month has gone by since the last earnings report for Golar LNG (GLNG - Free Report) . Shares have added about 1.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Golar LNG 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.
Golar LNG's Q4 Earnings & Revenues Beat Estimates
Golar LNG Limited delivered impressive fourth-quarter 2018 results, with earnings and revenues beating the Zacks Consensus Estimate.
The company’s earnings of 32 cents per share outpaced the Zacks Consensus Estimate by 17 cents. Also, the bottom line improved significantly on a year-over-year basis.
Total operating revenues amounted to $181.9 million, which surpassed the consensus mark of $132 million. The top line surged more than 100% year over year. Increased vessel demand owing to start-up of LNG production facilities drove the top line.
Of the total figure, revenues from vessel and other operations contributed 70% to the top line and amounted to $127.4 million. Revenues from FLNG operations came in at $54.5 million. Improved shipping activity led to increase in Time Charter Equivalent1 ("TCE") earnings of $77,600 per day in the quarter under discussion compared with $41,200 in the prior quarter.
Vessel operating expenses came in at $29.1 million compared with $28.9 million in the prior quarter. While administrative expenses fell to $12.7 million from $14.8 million in the third quarter, project development expenses declined to $4.7 million compared with $5.7 million in the prior quarter. Depreciation and amortization expenses of $28.3 million came almost in line with the prior quarter’s figure.
The company exited 2018 with cash and cash equivalents of $704.3 million compared with $214.9 million at December 2017 end. As of Dec 31, 2018, the company’s adjusted long-term debt totaled $2.1 billion compared with $1.02 billion as of Dec 31, 2017.
Concurrent with the earnings release, the board of directors approved a quarterly dividend payment of 15 cents per share. The dividend will be paid on April 3, 2019 to shareholders of record as on Mar 14, 2019.
The company expects improved operational efficiency in 2019 on the back of strength in shipping market activity and benefits from FLNG Hilli Episeyo operations. However, TCE rates are anticipated to decline significantly in the first quarter of 2019 compared with the quarter under discussion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -568.75% due to these changes.
Currently, Golar LNG has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Golar LNG has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.