National Fuel Gas (NFG) Up 0.6% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for National Fuel Gas (NFG). Shares have added about 0.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is National Fuel Gas 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 drivers.
National Fuel Gas Q3 Earnings Top Estimates, Sales Lag
National Fuel Gas Company reported fiscal third-quarter 2023 adjusted operating earnings of $1.01 per share, which surpassed the Zacks Consensus Estimate of 90 cents by 12.2%. The bottom line declined 34.3% from the year-ago figure of $1.54.
GAAP earnings in the quarter were $1 per share, down 14.5% from the year-ago level of $1.17.
Total Revenues
Sales of $428.7 million lagged the Zacks Consensus Estimate of $480 million by 10.7%.
The top line decreased 14.7% from the prior-year figure of $502.6 million. The year-over-year fall was primarily due to the loss of operations related to the divestiture of Seneca’s crude oil production in California and contract expirations in the pipeline and storage segment.
Highlights of the Release
Total operating expenses decreased 17.9% to $274.6 million year over year. This was primarily due to price hikes in purchased gas expenses.
Operating income was down 14.7% year over year to $154.1 million.
Interest expenses totaled $26.3 million, down 12.6% from the year-ago figure of $30.1 million.
Financial Highlights
As of Jun 30, 2023, National Fuel Gas had cash and temporary cash investments of $53.4 million compared with $46.1 million as of Sep 30, 2022.
Long-term debt (excluding current maturities) was $2,383.7 million as of Jun 30, 2023, compared with $2,083.4 million as of Sep 30, 2022.
Net cash provided by operating activities in the first nine months of fiscal 2023 was $1055.1 million compared with $654 million in the year-ago period.
Total capital expenditures in the first nine months of fiscal 2023 totaled $727.7 million compared with $592.5 million in the corresponding period of 2022.
Guidance
National Fuel Gas narrowed its fiscal 2023 earnings guidance to the range of $5.15-$5.25 per share from $5.10-$5.40. The Zacks Consensus Estimate for the same is pegged at $5.11 per share.
NFG now expects capital expenditures in the $905-$970 million range for fiscal 2023 compared with its earlier prediction of $865-$975 million. It expects production volume in the band of 370-380 billion cubic feet equivalent (Bcfe) for the same year.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
The consensus estimate has shifted 6.67% due to these changes.
VGM Scores
At this time, National Fuel Gas has an average Growth Score of C, a grade with the same score on the momentum front. However, the stock was allocated a grade of A on the value side, putting it in the top 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 trending upward for the stock, and the magnitude of this revision looks promising. Notably, National Fuel Gas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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National Fuel Gas Company (NFG) : Free Stock Analysis Report
