NFX Misses on Earnings & Revenues - Analyst Blog
November 05 2013 - 11:00AM
Zacks
Newfield Exploration
Company (NFX) reported adjusted third-quarter 2013
earnings of 47 cents per share, falling short of the Zacks
Consensus Estimate of 49 cents. The quarterly results also fell by
a penny from the year-earlier adjusted profit.
The company’s total revenue including discontinued operations
increased to $675.0 million from $615.0 million in year-earlier
quarter. It also came above the Zacks Consensus Estimate of $586.0
million.
Operational Performance
Total quarterly production was 12.0 million barrels of oil
equivalent (MMBoe), comprising
44% oil, 12% natural gas liquids (NGLs) and 44% natural gas.
Natural gas volumes were 31.8 billion cubic feet (Bcf). Oil,
condensate and natural gas liquids (NGLs) volumes were 6.7 million
barrels (MMBbls).
Newfield’s third quarter oil and natural gas price realizations
(including the effect of hedges) averaged $57.96 per Boe. Natural
gas prices were $3.88 per Mcf while liquid prices were $97.26 per
barrel.
Recurring lease operating expenses (LOE) were $6.81 per Boe.
Production and other taxes were $5.49 per Boe, while general and
administrative expenses totaled $5.56 per Boe.
Financials
At quarter end, Newfield had cash balance of $89.0 million.
Long-term debt was $3,485.0 million, representing a
debt-to-capitalization ratio of approximately 49.8%.
Guidance
For 2013, Newfield increased its estimated output to approximately
48 million barrels of oil equivalent (MMBOE) from its earlier
forecast of 46–47 MMBOE.
Outlook
Newfield Exploration’s diversified portfolio of assets provides
both flexibility and significant growth potential. We expect the
company’s reserve potential in the Southern Alberta Bakken, Wasatch
Oil, Uinta Basin and Williston play to be a liquid-rich catalyst
for the stock. The company expects its production from Cana
Woodford and Williston Basin to exceed 2013 guidance.
After adjusting the impact of asset sales in 2013, liquids
production is expected to increase by over 40%.
Though we remain positive on Newfield Exploration’s emerging
resource plays’ development program, we believe that its
sensitivity to gas price volatility, as well as drilling results,
costs, geo-political risks and project timing delays will weigh on
the stock. Increasing cost pressure in the highly competitive shale
plays is also a cause of concern.
Newfield Exploration shares currently carry a Zacks Rank #3 (Hold).
But there are other stocks in the oil and gas industry that appear
more attractive. These include SM Energy Company
(SM), Ocean Rig UDW Inc. (ORIG) and
TransAtlantic Petroleum Ltd. (TAT), which hold a
Zacks Rank #1 (Strong Buy).
NEWFIELD EXPL (NFX): Free Stock Analysis Report
OCEAN RIG UDW (ORIG): Free Stock Analysis Report
SM ENERGY CO (SM): Free Stock Analysis Report
TRANSATL PETROL (TAT): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
TransAtlantic Petroleum (AMEX:TAT)
Historical Stock Chart
From Apr 2024 to May 2024
TransAtlantic Petroleum (AMEX:TAT)
Historical Stock Chart
From May 2023 to May 2024