EQT Corp. Beats on Earnings & Revs - Analyst Blog

Integrated energy player, EQT Corporation's EQT first quarter 2014 adjusted earnings per share increased over three folds to $1.35 from 43 cents in the year-earlier quarter. This also came above the Zacks Consensus Estimate of 82 cents.

Net operating revenue in the quarter was up 63% year over year at $661.6 million. Also, reported revenues comfortably beat the Zacks Consensus Estimate of $546.0 million.

Segment Details

EQT Production's first quarter operating revenue increased 86.7% year over year to $467.7 million. This was due to steady focus on the Marcellus Shale, where sales volume rose 30% year over year to 106.1 billion cubic feet equivalent (Bcfe). Sales volume from the Marcellus/Upper Devonian averaged 923.6 million cubic feet equivalent per day (MMcfe/d), 50% higher than the year-ago period. Natural gas liquids NGL volume totaled 1,295 Mbbls, 16% higher over the year-ago period.
Operating income rose almost fourfold year over year to $277.2 million.

Under the EQT Midstream segment, net gathering revenues increased 9.2% year over year to $89.4 million, owing to 25% growth in gathered volumes. Net transmission revenues increased 40% to $52.1 million. Net storage, marketing and other operating revenues were $7.2 million, representing a 25.8% fall.

Operating income rose 11.9% year over year to $83.1 million in the reported quarter.

Cash Flow
 
The company's operating cash flow was $481.9 million during the quarter, reflecting an increase of 54.2% year over year.

Wells Spud

The company spud 64 gross wells during the quarter -- 46 wells targeted in the Marcellus with an average length-of-pay of 5,870 feet; 14 wells targeted in the Huron with an average length-of-pay of 6,395 feet; and 4 wells targeted in the Upper Devonian with an average length-of-pay of 5,460 feet.

Guidance

Production sales volume for 2014 is projected at 465–480 Bcfe, up 24% year over year; and liquids volume is expected at 6,800–6,900 thousand barrel of oil equivalent (MBBl). Production sales volume for second quarter 2014 is projected at 113–115 Bcfe; and liquids volume is expected at 1,600–1,650 MBBls.

Zacks Rank
 
The company currently holds a Zacks Rank #2 (Buy). Meanwhile one can also consider other energy sector stocks such as Pioneer Energy Services Corp. PES, RSP Permian, Inc. RSPP and Clayton Williams Energy, Inc. CWEI. All these stocks currently sport a Zacks Rank #1 (Strong Buy).