Yahoo Finance Why Is ONE Gas (OGS) Down 2.6% Since Last Earnings Report?
It has been about a month since the last earnings report for ONE Gas (OGS). Shares have lost about 2.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is ONE Gas due for a breakout? 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.
ONE Gas Q1 Earnings Miss Estimates, Revenues Down Y/Y
ONE Gas, Inc. reported first-quarter 2024 operating earnings per share (EPS) of $1.75, which lagged the Zacks Consensus Estimate of $1.78 by 1.7%. The bottom line was also 4.9% lower than the year-ago quarter’s figure of $1.84
The year-over-year decline in EPS was due to an increase in employee related expenses and lower sales volume owing to warmer-than-normal weather. These were marginally offset by higher revenues on the back of implementation of new rates.
Total Revenues
ONE Gas recorded revenues of $0.76 billion, which missed the Zacks Consensus Estimate of $1.01 billion by 25.4%. The top line also decreased 26.5% from $1.03 billion reported in the prior-year quarter.
Highlights of the Release
Total natural gas volumes delivered were 133.9 billion cubic feet (bcf), down 3.5% on a year-over-year basis. OGS served 2,290,000 customers, up 0.4% year over year.
Total operating expenses were $229.5 million, up 5.7% year over year. The upside was caused by a rise in operations and maintenance (O&M), and depreciation and amortization expenses.
Operating income decreased 2.2% year over year to $145.9 million.
OGS incurred net interest expenses of $31.4 million, up 4.3% on a year-over-year basis.
Financial Highlights
As of Mar 31, OGS had cash and cash equivalents of $11.5 million compared with $18.8 million as of Dec 31, 2023.
Total long-term debt (excluding current maturities) was $2.14 billion as of Mar 31, compared with $2.16 billion as of Dec 31, 2023.
Cash provided by operating activities was $108.3 million compared with $469.1 million in the year-ago quarter.
Capital expenditures and asset removal costs were $179.4 million compared with $164.6 million in the year-earlier quarter.
2024 Guidance
Management reaffirmed its EPS projection in the range of $3.70-$4.00. The Zacks Consensus Estimate is pegged at $3.86, a tad higher than the mid-point of the company’s guided range of $3.85.
OGS continues to expect capital expenditures, including asset removal costs, of $750 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
VGM Scores
Currently, ONE Gas has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. 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 this revision indicates a downward shift. Notably, ONE Gas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
ONE Gas is part of the Zacks Utility - Gas Distribution industry. Over the past month, National Fuel Gas (NFG), a stock from the same industry, has gained 1.5%. The company reported its results for the quarter ended March 2024 more than a month ago.
National Fuel Gas reported revenues of $629.94 million in the last reported quarter, representing a year-over-year change of -12.2%. EPS of $1.79 for the same period compares with $1.54 a year ago.
National Fuel Gas is expected to post earnings of $0.84 per share for the current quarter, representing a year-over-year change of -16.8%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
National Fuel Gas has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.
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ONE Gas, Inc. (OGS) : Free Stock Analysis Report
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