Truist expects Q1 E&P earnings to decline sequentially

Chord Energy

05/04/2024 16:29

** Truist Securities says most exploration and production
(E&P) companies are likely to post sequentially lower quarterly
earnings/free cash flow in Q1
    ** "We anticipate only a few notable 1Q24 impacts such as
materially weak Waha and other regional natural gas prices,
January storms and occasional lower OFS costs" - brokerage
    ** Most E&Ps have ample near-term inventory and continue to
operate in virtually the same areas as the prior year, likely
resulting in minimal change to well productivity, says Truist
    ** "Based on YTD results, valuations and our expectations
into Q1 earnings season, we favor lower cost/higher shareholder
return E&Ps and a few with more torque such as Devon Energy
 DVN.N , Marathon Oil  MRO.N , Permian Resources  PR.N ,
Chesapeake Energy  CHK.O , Gulfport Energy  GPOR.N  and Vital
Energy  VTLE.N , among others"
    ** Truist expects natgas companies to keep their output cuts
in place for now, but are gearing up to increase production back
to previous levels starting as soon as mid-year, unless there is
another leg down in gas pricing
    
    Following are some PT changes made by Truist        
 Company              New PT      Old PT
 ConocoPhillips       $170        $173
  COP.N                           
 Chevron Corp         $156        $168
  CVX.N                           
 Exxon Mobil Corp     $146        $140
  XOM.N                           
 Chord Energy Corp    $224        $229
  CHRD.O                          
 APA Corp  APA.O      $53         $59
 Devon Energy Corp    $66         $69
  DVN.N                           
 EOG Resources        $163        $165
  EOG.N                           
 Civitas Resources    $103        $110
 Inc  CIVI.N                      
 Diamondback Energy   $248        $250
 Inc  FANG.O                      
 Pioneer Natural      $278        $238
 Resources  PXD.N                 
 Chesapeake Energy    $112        $119
 Corp  CHK.O                      
 
 (Reporting by Roshia Sabu in Bengaluru)
 ((Roshia.Sabu@thomsonreuters.com))