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How Williams Companies Looks before Its Q4 Earnings


Feb. 7 2019, Published 11:09 a.m. ET

Williams Companies

Williams Companies (WMB) is scheduled to release its fourth quarter and fiscal 2018 earnings on February 13. According to analysts’ estimates, Williams Companies could report revenues of $2.30 billion for the quarter ending December 31, which indicates revenue growth of more than 3% compared to the same period in 2017.

Recently, Williams Companies stock has been on a solid uptrend. So far, the stock has risen more than 20% in 2019, while the energy sector (XLE) has risen ~13% during the same period. Williams stock showed notable weakness in the fourth quarter, which could be attributed to the steep fall in crude oil prices. We’ll have to see how Williams Companies’ fourth-quarter earnings set a path for its stock ahead.

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Revenue drivers

Williams Companies is a leading natural gas infrastructure company that handles ~30% of the total US natural gas volumes. During the fourth quarter, Henry Hub natural gas spot prices largely trended upward and rose from $3.1 per MMBtu (million British thermal units) to $3.3 per MMBtu. Natural gas prices were almost 30% higher in the fourth quarter compared to the fourth quarter of 2017, which could have a positive impact on energy companies’ revenues in the fourth quarter.

Williams Companies brought the Atlantic Sunrise project in service in the fourth quarter, which carries natural gas from Pennsylvania to South Carolina. The consolidated fee-based revenues are expected to increase by $25 million–$30 million per month. Williams Companies sold a few of its pipelines in the US Gulf Coast region in December to Easton Energy. The company has generated more than $4.4 billion in asset sales in the last three years, which will likely reduce its direct commodity exposure and leverage.


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