A month has gone by since the last earnings report for Gulfport Energy (GPOR - Free Report) . Shares have lost about 11.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Gulfport Energy due for a breakout? 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 drivers.
Gulfport Q1 Earnings & Sales Top Estimates
Gulfport Energy reported first-quarter adjusted net income per share of 33 cents, beating the Zacks Consensus Estimate of 30 cents on the back of higher-than-expected natural gas realizations. Precisely, natural gas realizations came in at $2.70 per thousand cubic feet, beating the Zacks Consensus Estimate of $2.56. However, the bottom line was below the year-ago EPS of 56 cents a share amid lower production and higher costs.
Revenues of $320.6 million surpassed the Zacks Consensus Estimate of $317 million. The top line, however,declined from the year-ago figure of $325.4 million.
Production & Realized Prices
Gulfport’s total oil and gas production decreased to 1,263.6 million cubic feet equivalent per day (MMcfe/d) from 1,288.6MMcfe/d recorded in the corresponding period of last year. Of the total output, 89.7% comprised natural gas. Gas production from Utica Shale declined 3.6% y/y to 89,428 MMcfe. Nearly 78.6% of its output came from the Utica acreage. Output from SCOOP came in at 23,394 MMcfe, a tad higher than the year-ago level of $22,103 MMcfe.
Average realized natural gas oil price (before the impact of derivatives) during the first quarter was $2.70 per thousand cubic feet, higher than the year-ago period’s $2.44. However, average realized natural gas liquids price was 58 cents per gallon, down from the year-ago quarter’s 71 cents. Gulfport fetched $53.10 per barrel of oil during the quarter, down from the year-ago figure of $60.36. Overall, the company realized $3.00 per thousand cubic feet equivalent in the quarter vis-a-vis $2.95a year ago.
Total expenses in the quarter under review amounted to $229.1million, reflecting an increase of 6.5% from $215.1 million in the prior-year period. This uptick is mainly attributed to higher production taxes, lease operating expenses, and depreciation and midstream gathering/processing charges incurred in the reported quarter.
Depreciation costs scaled up 6.7% to $118.4 million and midstream gathering/processing expenses rose 9.5% from the prior-year quarter to $70.3 million.
Capex, Balance Sheet & Stock Buyback
In the reported quarter, Gulfport spent $254.9 million on drilling and completion (D&C). As of Mar 31, the natural gas-weighted energy explorer had approximately $17.9 million in cash and cash equivalents. Gulfport had a long-term debt of $2,087.7 million, representing a debt-to-capitalization ratio of around 38.3%.
In January 2019, the company had authorized the repurchase of $400 million shares of its common stock over the next two years, out of which it bought back shares worth $30 million in the quarter under review.
2019 Guidance Retained
Gulfport reiterated its 2019 guidance that was unveiled in January. The upstream player expects 2019 capex in the band of $565-$600 million. It projects 2019 production within 1,360-1,400 MMcfe/d. Moreover, the company expects free cash flow to exceed $100 million.
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 -7.76% due to these changes.
At this time, Gulfport Energy has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. 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, Gulfport Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.