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ONE Gas (OGS) Beats on Q2 Earnings, Raises 2019 Guidance

Zacks Equity Research

ONE Gas, Inc. OGS recorded second-quarter 2019 operating earnings of 46 cents per share, beating the Zacks Consensus Estimate of 41 cents by 12.2%.

Moreover, the reported earnings improved 17.9% year over year driven by new rates, and marginally lower operation and maintenance expenses.

Total Revenues

The company reported total revenues of $290.6 million in the second quarter, lagging the Zacks Consensus Estimate of $294 million by nearly 1.15% and declining from the prior-year figure of $292.5 million by 0.7%.

ONE Gas, Inc. Price, Consensus and EPS Surprise

ONE Gas, Inc. Price, Consensus and EPS Surprise

ONE Gas, Inc. price-consensus-eps-surprise-chart | ONE Gas, Inc. Quote

Quarterly Highlights

Total operating expenses in the reported quarter increased 2.4% from the year-ago period to $161.1 million.

Operating income in the reported quarter increased 14.1% year over year to $46.9 million.

The company incurred interest expenses of $15.4 million, increasing 28.3% from the year-ago period.

Financial Highlights

On Jun 30, 2019, ONE Gas had cash and cash equivalents of $11.1 million compared with $21.3 million at 2018-end.

Long-term debt (excluding current maturities) was $1,285.8 million as of Jun 30, 2019, increasing marginally from the Dec 31, 2018 level of $1,285.5 million.

The company’s cash flow from operating activities in the first half of 2019 was $241.1 million compared with $399.9 million in the prior-year period.

Guidance

ONE Gas upwardly revised its guidance for 2019 net income to the range of $180-$190 million from $174-$190 million. Earnings per share guidance was revised upward to the band of $3.39-$3.57 from $3.27-$3.57 per share. The midpoint of management’s 2019 EPS guidance is $3.48, higher than the current Zacks Consensus Estimate of $3.45 for the period.

The company reiterated its 2019 capital expenditure view of $450 million. Out of the projected expenditure, 70% is directed toward system integrity and replacement projects.

Upcoming Releases

MDU Resources Group Inc. MDU is expected to release second-quarter 2019 results on Jul 31. The Zacks Consensus Estimate for the quarter is pegged at 25 cents.

National Fuel Gas Company NFG is expected to release third-quarter fiscal 2019 results on Aug 2. The Zacks Consensus Estimate for the quarter to be reported is pegged at 64 cents.

Atmos Energy Corporation ATO is expected to release third-quarter fiscal 2019 results on Aug 7. The Zacks Consensus Estimate for the quarter is pegged at 69 cents.
 
Zacks Rank

ONE Gas currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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