Yahoo Finance Why Is Antero Midstream (AM) Up 1.3% Since Last Earnings Report?
It has been about a month since the last earnings report for Antero Midstream Corporation (AM). Shares have added about 1.3% 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 Midstream due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Antero Midstream Q1 Earnings Meet Estimates, Revenues Top
Antero Midstream reported first-quarter 2024 adjusted earnings per share of 24 cents, in line with the Zacks Consensus Estimate. The bottom line improved from the year-ago quarter’s level of 21 cents.
Total quarterly revenues of $279 million surpassed the Zacks Consensus Estimate of $274 million. The top line also increased from $259.5 million recorded in the year-ago quarter.
The in-line earnings were driven by higher compression volumes and increased gathering volumes.
Operational Performance
In the first quarter, average daily compression volumes were 3,260 million cubic feet (MMcf/d) compared with 3,137 MMcf/d in the year-ago quarter. The reported figure was also higher than our estimate of 3,195 MMcf/d. On a per-Mcf basis, the compression fee was 21 cents, in line with the prior-year quarter’s number.
High-pressure gathering volumes totaled 2,966 MMcf/d, up from the year-ago period’s level of 2,801 MMcf/d. The figure was also higher than our estimate of 2,882 MMcf/d. On a per-Mcf basis, the average gathering high-pressure fee was 22 cents, higher than the year-ago quarter’s 21 cents.
Low-pressure gathering volumes averaged 3,301 MMcf/d compared with 3,171 MMcf/d in the first quarter of 2023. The figure came in higher than our estimate of 3,202 MMcf/d. On a per-Mcf basis, the average gathering low-pressure fee was 36 cents, higher than the prior-year quarter’s level of 35 cents. The reported figure was in line with our estimate.
Freshwater delivery volumes were registered at 113 MBbls/d, down approximately 8% from the prior-year quarter figure of 123 MBbls/d. On a per-barrel basis, the average freshwater distribution fee was $4.30 compared with $4.21 a year ago. The figure was also higher than our estimate of $4.22.
Operating Expenses
Direct operating expenses amounted to $53.9 million, down from $57.9 million recorded a year ago.
Antero Midstream’s total operating expenses totaled $112.8 million, up from $111.1 million recorded in the corresponding period of 2023.
Balance Sheet
As of Mar 31, 2024, the company had cash and cash equivalents of $26.1 million. As of the same date, the company had $3,174.9 million of long-term debt.
Outlook
For 2024, Antero Midstream reiterated adjusted EBITDA to be in the range of $1,020-$1,060 million, indicating a 5% increase from the 2023 level at the midpoint. The company projects free cash flows after dividends in the range of $235-$275 million for 2024. The capital budget for 2024 is expected to be in the band of $150-$170 million, indicating a 14% decrease from the 2023 level at the midpoint.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
VGM Scores
At this time, Antero Midstream has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. 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. It's no surprise Antero Midstream has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
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Antero Midstream Corporation (AM) : Free Stock Analysis Report
