EOG Resources (EOG) Q1 Earnings In Line, Revenues Beat

Upstream energy company EOG Resources Inc. (NYSE:EOG) reported first-quarter 2017 adjusted earnings of 15 cents, in line with the Zacks Consensus Estimate. In the year-earlier quarter, the company reported a loss of 83 cents per share.

Total revenue in the quarter skyrocketed 93% year over year to $2,611 million. Moreover, the top line handily beat the Zacks Consensus Estimate of $2,279 million.

The strong first-quarter results were supported by increased liquid production as well as higher oil and gas price realizations.

Operational Performance

In the quarter, EOG Resources’ total volume inched up 2.8% year over year to 51.4 million barrels of oil equivalent (MMBoe).

Crude oil and condensate production in the quarter totaled 315.7 thousand barrels per day (MBbl/d), up 18% from the prior-year level. Natural gas liquids (NGL) volumes, however, dipped 1% year over year to 78.8 MBbl/d. Also, natural gas volumes decreased to 1,058 million cubic feet per day (MMcf/d) from the year-earlier level of 1,215 MMcf/d.

Average price realization for crude oil and condensates surged more than 63% year over year to $50.34 per barrel. Quarterly NGL prices also skyrocketed approximately 108% from $10.41 a year ago to $21.63 per barrel. Natural gas was sold at $2.42 per thousand cubic feet (Mcf), up 61.3% year over year.

First-Quarter Price Performance

During the January–March quarter, EOG Resources outperformed the Zacks categorized Oil & Gas-U.S Exploration & Production industry. In the period, the stock lost 3.5% compared with 11.1% decline for the broader industry.

Liquidity Position

At the end of the first quarter, EOG Resources had cash and cash equivalents of $1,546.6 million and long-term debt of $6,980 million. This represents a debt-to-capitalization ratio of 33.4%.

During the quarter, the company generated approximately $1,072.8 million in discretionary cash flow compared with $397.9 million in the year-ago quarter.

Guidance

For 2017, the company expects crude volume between 567.1 MBoe/d and 608.7 MBoe/d. For the second quarter, the company anticipates production in the range of 562.2−592.7 MBoe/d.

Zacks Rank & Stocks to Consider

Currently, EOG Resources carries a Zacks Rank #3 (Hold). This implies that the stock will perform in line with the broader U.S. equity market over the next one to three months.

Some better-ranked players in the energy sector include McDermott International Inc. (NYSE:MDR) , W&T Offshore Inc. (NYSE:WTI) and Bellatrix Exploration Ltd. (TO:BXE) . McDermott and Bellatrix Exploration sport a Zacks Rank #1 (Strong Buy), while W&T Offshore carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

McDermott beat the Zacks Consensus Estimate in each of the trailing four quarters with an average positive surprise of 387.50%.

W&T Offshore had an average positive earnings surprise of 69.21% in the last four quarters.

Bellatrix Exploration surpassed the Zacks Consensus Estimate in three of the last four quarters with an average positive earnings surprise of 58.54%.

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