Yahoo Finance Antero Resources (AR) Up 0.4% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Antero Resources (AR). Shares have added about 0.4% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Antero Resources 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 catalysts.
Antero Resources Q1 Earnings Beat Estimates
Antero Resources Corporation reported first-quarter 2024 adjusted earnings of 7 cents per share, which beat the Zacks Consensus Estimate of 4 cents. However, the bottom line declined significantly from the year-ago quarter’s level of 51 cents.
Total quarterly revenues of $1.12 billion surpassed the Zacks Consensus Estimate of $1.08 billion. The top line, however, decreased from the year-ago quarter’s figure of $1.41 billion.
Better-than-expected quarterly earnings can be primarily attributed to higher production volumes, driven by strong well performance and lower operating expenses. However, a decline in natural-gas-equivalent price realization has offset the positives.
Overall Production
Total production in the first quarter was 312 billion cubic feet equivalent (Bcfe), up 6% from 295 Bcfe recorded a year ago. Our estimate for the same was pinned at 297 Bcfe.
Natural gas production (accounting for 65% of the total production) was 202 Bcf, up 4% from 194 Bcf recorded a year ago. The figure also exceeded our estimate of 197 Bcf.
Oil production in the quarter amounted to 1,035 thousand barrels (MBbls), up 25% from the 831 MBbls registered in the year-ago period.
AR reported production of 6,760 MBbls of C2 Ethane, up 10% from 6,141 MBbls recorded a year ago. Our estimate for the same was pinned at 7,108 MBbls.
The company’s production of 10,564 MBbls of C3+ NGLs was 7% higher than 9,857 MBbls reported in the year-ago period. The figure also surpassed our estimate of 10,254 MBbls,
Realized Prices (Excluding Derivative Settlements)
Weighted natural-gas-equivalent price realization in the quarter was $3.39 per thousand cubic feet equivalent (Mcfe), lower than the year-ago quarter’s figure of $4.13. Our estimate for the same was pegged at $2.75 Mcfe.
Realized prices for natural gas declined 32% to $2.35 per Mcf from $3.45 recorded a year ago. Our estimate for the same was pinned at $2.24 per Mcf.
The company’s oil price realization in the quarter was $62.53 per barrel (Bbl), slightly up from $62.35 registered a year ago. The figure was below our estimate of $65.43 per Bbl.
The realized price for C3+ NGLs increased to $43.05 per Bbl from $42.95 reported a year ago.
The realized price for C2 Ethane decreased 21% to $9.32 per Bbl from $11.73 recorded a year ago. The figure also missed our estimate of $12.54 per Bbl.
Operating Expenses
Total operating expenses decreased to $1.06 billion from $1.08 billion reported in the year-ago period. Our estimate for the same was pinned at $1.02 million.
However, average lease operating costs were 9 cents per Mcfe, down 10% from 10 cents recorded in the year-ago period. The gathering and compression costs were 72 cents per Mcfe in line with the prior-year quarter’s number.
Transportation expenses declined 6% from the prior-year quarter’s level to 62 cents per Mcfe, while processing costs increased 1% to 82 cents per Mcfe.
Capex & Financials
In the first quarter, Antero Resources spent $187 million on drilling and completion operations. As of Mar 31, 2024, it had no cash and cash equivalents. The company had a long-term debt of $1.51 billion as of the same date.
Guidance
For 2024, Antero Resources increased its net daily natural gas-equivalent production guidance to 3.35-3.4 Bcfe/d, including higher liquid volumes. The company lowered its cash production expense guidance to $2.40-$2.50 per Mcfe.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -25% due to these changes.
VGM Scores
Currently, Antero Resources has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Antero Resources has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Antero Resources Corporation (AR) : Free Stock Analysis Report
