Upstream operator PDC Energy PDCE reported adjusted earnings per share of $5.11, comfortably beating the Zacks Consensus Estimate of $4.57. The company had reported a profit of $1.66 in the year-ago quarter. The outperformance can be primarily attributed to higher commodity prices.
Meanwhile, PDC Energy recorded total revenues of 1.1 billion, soaring from the year-ago level of $228.9 million and exceeding the consensus mark by 3.8%.
The company is using the excess cash from a supportive environment to reward investors with dividends and buybacks. As part of that, PDCE’s board of directors declared a quarterly cash dividend of 35 cents per share to its common shareholders. In fact, PDC Energy returned $250 million to its shareholders during the second quarter through dividends and buybacks.
PDC Energy, Inc. Price, Consensus and EPS Surprise
PDC Energy, Inc. price-consensus-eps-surprise-chart | PDC Energy, Inc. Quote
Production & Prices
For the second quarter of 2022, PDC Energy’s production totaled 21,410 thousand barrels of oil equivalent/MBoe (61% liquids), reflecting an increase of 22.9% from 17,424 MBoe a year ago. However, the Colorado-focused company’s quarterly average production came in below the Zacks Consensus Estimate of 21,800 Mboe due to certain operational issues. Of the aggregate output, 18,328 MBoe (or some 86%) came from Wattenberg Field and the rest from Delaware Basin.
The average realized natural gas price jumped from $1.98 per thousand cubic feet (Mcf) in the year-ago quarter to $5.57. PDC Energy sold NGLs at an average price of $34.99 per barrel (Bbls) compared to $20.11 a year ago. Meanwhile, the average oil price realization came in at $108.24 per barrel, 66.4% higher than $65.05 in the year-ago period. Overall, PDC Energy fetched $57.81 per MBoe compared with $30.60 a year ago.
Capital Expenditure & Balance Sheet
The energy explorer shelled out $346.7 million in the form of oil and gas capital investments, while it raked in $405 million in adjusted free cash flow. As of Jun 30, PDC Energy had approximately $38.5 million in cash and cash equivalents, and $1.7 billion in long-term debt, representing a debt-to-capitalization of 32.9%.
For 2022, PDC Energy expects to pump 230,000-240,000 Boe per day of hydrocarbon. It also gave its average oil production expectation of 73,000-77,000 barrels per day. The Zacks Rank #3 (Hold) company forecast capital spending of $1.025 billion to $1.075 billion. The company has guided for some $1.6 billion in free cash flow in 2022 and hopes to return $1 billion to its shareholders.
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Some Key E&P Earnings
While we have discussed PDCE’s second-quarter results in detail, let’s see how some other exploration and production companies have fared this earnings season.
ConocoPhillips COP reported second-quarter adjusted earnings per share of $3.91, beating the Zacks Consensus Estimate of $3.78. Further, COP’s bottom line significantly improved from the prior-year quarter’s $1.27 per share. Strong quarterly results of one of the world’s largest independent oil and gas producers based in Houston, TX, ConocoPhillips, may have been aided by increased oil-equivalent production volumes and realized commodity prices.
ConocoPhillips revised higher its expected 2022 return of capital to shareholders. The new guidance is $15 billion versus the prior projection of $10 billion. COP’s incremental returns to stockholders will get distributed through share repurchases and variable returns of cash tiers.
Another upstream giant, EOG Resources EOG, reported second-quarter adjusted earnings per share of $2.74, missing the Zacks Consensus Estimate of $2.99. EOG’s weaker-than-expected earnings were attributed to higher lease and well expenses, as well as transportation costs. However, the bottom line jumped from the year-ago quarter’s earnings of $1.73 due to increased volumes and prices.
For the quarter under review, EOG Resources’ production increased 11% year over year, while it generated $1.3 billion in free cash flow. Committed to shareholder returns, EOG announced a special dividend of $1.50 per share.
Finally, we have Pioneer Natural Resources Company PXD, which reported second-quarter earnings of $9.36 per share (excluding one-time items), beating the Zacks Consensus Estimate of $8.81. The bottom line surged from the year-ago quarter’s profit of $2.55 per share. PXD’s robust bottom line can be attributed to higher production volumes and commodity price realizations.
Pioneer Natural announced a dividend payment of $8.57 per share of common stock, which includes a variable dividend of $7.47 per share and a base dividend of $1.10. This suggests a 16.1% increase from the prior dividend of $7.38 per share.
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