MPLX LP (MPLX) Down 1.1% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for MPLX LP (MPLX). Shares have lost about 1.1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is MPLX LP 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 catalysts.
MPLX Q2 Earnings Beat on Gathering & Pipeline Throughput
MPLX reported second-quarter earnings of 91 cents per unit, beating the Zacks Consensus Estimate of 86 cents. The bottom line also improved from the year-ago quarter’s 83 cents.
Total quarterly revenues of $2,690 million surpassed the Zacks Consensus Estimate of $2,483.5 million. The top line declined from the prior-year quarter’s $2,940 million.
Strong quarterly earnings were owing to increased pipeline throughputs and gathering throughput.
Segmental Highlights
MPLX’s adjusted EBITDA from the Logistics and Storage segment increased from $966 million a year ago to $1,022 million and surpassed our estimate of $889 million. Increased rates and growth in throughput aided the segment. Total pipeline throughputs in the second quarter were 6 million barrels per day, up by a marginal 1% from the year-ago period.
Adjusted EBITDA from the Gathering and Processing segment was $509 million, up from $491 million in the prior-year quarter and beating our estimate of $482.9 million. The segment was favored by increased gathering throughput volumes. Gathering throughput volumes averaged 6.2 billion cubic feet per day (Bcf/d), reflecting a 9% rise from the year-ago period. Natural gas processed volumes of 8.9 Bcf/d marked a 6% increase.
Costs and Expenses
In second-quarter 2023, total costs and expenses of MPLX were $1,515 million, down from the year-ago quarter’s $1,823 million.
Cash Flow
Distributable cash flow attributable to MPLX in the quarter was $1,315 million, providing 1.7X distribution coverage, up from $1,237 million in the year-ago quarter.
Adjusted free cash flow in the quarter under review decreased to $1,162 million from $1,349 million in the corresponding period of 2022.
Balance Sheet
As of Jun 30, 2023, the partnership’s cash and cash equivalents were $755 million. Its total debt amounted to $20.4 billion.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
At this time, MPLX LP has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile 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.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, MPLX LP has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
MPLX LP is part of the Zacks Oil and Gas - Production and Pipelines industry. Over the past month, Kinder Morgan (KMI), a stock from the same industry, has gained 0.5%. The company reported its results for the quarter ended June 2023 more than a month ago.
Kinder Morgan reported revenues of $3.5 billion in the last reported quarter, representing a year-over-year change of -32%. EPS of $0.24 for the same period compares with $0.27 a year ago.
Kinder Morgan is expected to post earnings of $0.26 per share for the current quarter, representing a year-over-year change of +4%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Kinder Morgan has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
MPLX LP (MPLX) : Free Stock Analysis Report
Kinder Morgan, Inc. (KMI) : Free Stock Analysis Report
