Pioneer Natural Resources (PXD) reported strong second-quarter profits and cash flow after the bell Tuesday, but favorable revisions to its guidance shined the brightest. Pioneer’s oil-and-gas revenue totaled $2.98 billion, down nearly 36% from the year-ago period. It’s unclear how this figure stacks up to the Refinitiv estimate of $3.52 billion, which we think factors in oil and gas plus other income items. Adjusted earnings per share of $4.49 solidly outpaced the consensus EPS estimate of $4.19. As a reminder, Pioneer is one of the few companies that host its post-earnings conference call the day after releasing numbers, instead of the same night. Pioneer’s second-quarter call is set to kick off at 10 a.m. ET on Wednesday. PXD YTD mountain Pioneer Natural Resources’ year-to-date stock performance. Bottom line With its hearty earnings beat, Pioneer showcased its money-making ability during a quarter in which oil prices largely trended downward. Still, perhaps the best news in the report is what Pioneer expects to happen next: The company trimmed its full-year capital budget outlook, partially citing operational efficiencies, while also modestly raising its total-production forecast. That demonstrated the company’s operational quality. Wall Street also appears pleased, with the stock up more than 1% in after-hours trading. The combination of spending a bit less despite pumping a bit more is a very encouraging sign from the large Permian Basin producer. What’s more, Pioneer may see additional relief in spending in the quarters ahead as inflationary pressures on oilfield services ease. Pioneer’s after-hours move extends a more-than 12% advance for the stock since late June, which has coincided with a rebound in crude prices . The oil bounce pushed the commodity to levels last seen in April. After Tuesday’s report, we continue to feel comfortable owning Pioneer, knowing it’s the best-run independent oil producer with some of the lowest break-even costs, making it well-positioned to benefit from any future increases in oil prices that may occur into year-end.
Permian Basin rigs in 2020, when U.S. crude oil production dropped by 3 million a day as Wall Street pressure forced cuts.
Paul Ratje | Afp | Getty Images
Pioneer Natural Resources (PXD) reported strong second-quarter profits and cash flow after the bell Tuesday, but favorable revisions to its guidance shined the brightest.
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