Independent oil and gas exploration company,
Cabot Oil & Gas Corporation
) posted strong second-quarter 2014 results. Significant higher
production - especially from Marcellus and Eagle Ford Shales −
during the quarter led to the improvement which was partially
offset by higher operating expenses.
Cabot reported earnings per share of 28 cents (excluding one-time
items), higher than the prior-year quarter adjusted level of 22
cents. Moreover, the company beat the Zacks Consensus Estimate of
Cabot Oil & Gas Corporation - Earnings
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During the three-month period ended Jun 30, 2014, Texas-based
Cabot generated operating revenues of $533.2 million, up 18.6% year
over year. The top line also surpassed the Zacks Consensus Estimate
of $527.0 million.
Cabot's overall production during the quarter totaled 127.6 billion
cubic feet equivalent (Bcfe) - 95.5% gas - up 34.0% from the
prior-year quarter. Natural gas volumes surged 34.3% year over year
to 121.8 Bcf. Moreover, liquids volumes increased to 961 thousand
barrels (MBbl) from 763 MBbl. Strong quarterly results from the
Marcellus and Eagle Ford Shales drove the overall volume growth.
Average realized natural gas price fell 14.5% from the year-ago
quarter to $3.47 per thousand cubic feet. The average oil price
realization also decreased 2.5% year over year to $98.84 per
Costs & Expenses
Transportation and gathering costs were 59.5% higher year over
year, totaling $84.0 million, while exploration costs increased
3.3% to $4.7 million.
Depreciation, depletion and amortization expenses increased to
$157.6 million from $151.4 million in the second quarter of 2013.
Total operating expenses increased 12.8% to $321.8 million from the
Drilling Statistics, Capital Expenditure & Balance
Net wells drilled during the quarter decreased to 35 from 44 in the
year-ago period. The success rate of the drilled well was 100%.
Operating cash flows came in at $329.6 million, while capital
expenditures totaled $278.9 million. As of Jun 30, 2014, Cabot had
$1,193.0 million in long-term debt, with a debt-to-capitalization
ratio of 34.0%.
Cabot retained its 2014 production guidance at 530-585 Bcfe.
The company also maintained its 2014 capital budget at
Zacks Rank & Stock Picks
Cabot currently carries a Zacks Rank #3 (Hold), implying that it is
expected to perform in line with the broader U.S. equity market
over the next one to three months.
Meanwhile, one can look at better-ranked players in the same
industry like VOC Energy Trust (
), Clayton Williams Energy Inc. (
EXCO Resources Inc. (
). All these stocks sport a Zacks Rank #1 (Strong Buy).
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CABOT OIL & GAS (COG): Free Stock Analysis
WILLIAMS(C)ENGY (CWEI): Free Stock Analysis
VOC ENERGY TRST (VOC): Free Stock Analysis
EXCO RESOURCES (XCO): Free Stock Analysis
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