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Did Cabot Oil and Gas’s 2016 Operating Plan Deliver in 2Q?

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Aug. 2 2016, Published 3:40 p.m. ET

Cabot Oil and Gas’s 2Q16 revenue

Cabot Oil and Gas (COG) reported its 2Q16 earnings on July 29. Its 2Q16 revenue was $274 million versus an estimate of $276 million. Revenue in 2Q15 was ~$306 million. In 1Q16 it was $263 million.

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Cabot Oil and Gas’s 2Q16 earnings

Cabot reported an adjusted net loss of $30.2 million in 2Q16. Adjusted net income in the corresponding period in 2015 was $14.6 million. The company reported adjusted EPS (earnings per share) of -$0.07. Wall Street analysts’ consensus estimate for EPS was -$0.08.

As you can see in the graph above, Cabot Oil and Gas’s earnings and revenues were in line with analysts’ expectations.

Peer comparison

QEP Resources (QEP) announced 2Q16 earnings of $-0.23, while EQT (EQT) reported 2Q16 earnings of $0.35. Noble Energy (NBL) is expected to report 2Q16 earnings of -$0.29.

Key management comments

CEO Dan Dinges noted in the 2Q16 press release, “Cabot’s 2016 operating plan was designed to provide modest production growth while generating positive free cash flow despite a lower commodity price environment.” Speaking about 2Q16 results, he added, “Our second quarter results delivered on this plan as the Company grew equivalent production 10 percent relative to the second quarter of last year while generating operating cash flow that exceeded our capital expenditures, pipeline investments, and dividends.” 

Dinges added, “We anticipate significantly more positive free cash flow generation in the second half of the year based on the current commodity price outlook.”

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