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W&T Offshore Stock Rises 35% So Far in September: What’s Up?

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Part 3
W&T Offshore Stock Rises 35% So Far in September: What’s Up? PART 3 OF 10

Why W&T Offshore’s Revenues Are Trending Upward

W&T Offshore’s 2Q17 revenues

For 2Q17, W&T Offshore (WTI) reported revenue of ~$123.0 million, which was higher than the Wall Street analyst consensus of ~$121.0 million. For 2Q17, it reported crude oil (USO) sales of ~$86.0 million, natural gas liquids sales of ~$7.0 million, natural gas sales of ~$29.0 million, and other revenues of ~$1.0 million. That means that almost 76.0% of WTI’s 2Q17 revenues came from liquids sales. So WTI stock could be more sensitive to crude oil prices than natural gas prices.

Why W&amp;T Offshore’s Revenues Are Trending Upward

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Sequentially, WTI’s 2Q17 revenues are slightly lower than its 1Q17 revenues of ~$124.0 million. However, on a year-over-year basis, its 2Q17 revenues are higher by ~23.0% when compared with 2Q16 revenues of -$100.0 million.

The year-over-year increase in W&T Offshore’s 2Q17 production, coupled with higher realized prices for crude oil (USO), natural gas liquids, and natural gas (UNG), has impacted WTI’s revenues positively. WTI reported a ~23.0% higher total realized price of $31.10 per boe (barrel of oil equivalent) in 2Q17 from $25.28 per boe in 2Q16. We’ll look at WTI’s production in the next part.

WTI’s 1Q17 revenues

For 1Q17, W&T Offshore reported revenues of ~$124.0 million, which was slightly higher than Wall Street analysts’ consensus for revenues of ~$123.0 million. Sequentially WTI’s 1Q17 revenues were ~8.0% higher than 4Q16 revenues of ~$115.0 million. Even on a year-over-year basis, WTI’s 1Q17 revenues were ~59.0% higher than 1Q16 revenues of ~$78.0 million.

Putting WTI’s revenues in context

Compared to WTI’s $123.0 million in revenues for 2Q17, Kosmos Energy (KOS) reported revenues of ~$147.0 million in the same quarter, which was lower than Wall Street analysts’ consensus for revenues of ~$171.0 million. On a year-over-year basis, KOS’s 2Q17 revenues are ~220.0% higher than 2Q16 revenues of ~$46.0 million. Like WTI, Kosmos Energy operates in the offshore oil and gas exploration and production segment. The First Trust ISE-Revere Natural Gas ETF (FCG) invests in natural gas producers, whereas the Vanguard Energy ETF (VDE) invests in the broader energy market through stocks across the energy subsectors.

Next, let’s look at W&T Offshore’s 2Q17 operational performance.

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