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CNX Resources (CNX) Down 12.3% Since Last Earnings Report: Can It Rebound?

Zacks Equity Research

It has been about a month since the last earnings report for CNX Resources (CNX). Shares have lost about 12.3% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is CNX Resources due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

CNX Resources Q1 Earnings & Revenues Miss Estimates

CNX Resources Corporation reported adjusted earnings of 14 cents per share in first-quarter 2019, lagging the Zacks Consensus Estimate of 21 cents by a whopping 33.3%.

Revenues

Total revenues of $278.4 million in the first quarter missed the Zacks Consensus Estimate of $406 million by 31.4%.

Highlights of the Release

CNX Resources registered a 3% year-over-year increase in gas sales volumes to 133 billion cubic feet equivalent (Bcfe) in the quarter under review. The increase was primarily attributable to higher Marcellus sales volumes.

Since the inception of the current repurchase program in October 2017, the company repurchased nearly 36 million shares for around $518 million, which reduced total shares outstanding by about 15% to 195,467,633.

Financial Update

As of Mar 31, 2019, CNX Resources had cash and cash equivalents of $23.9 million, up from $17.2 million on Dec 31, 2018.

Total long-term debt as of Mar 31, 2019 was $2,430.5 million, higher than $2,378.2 million on Dec 31, 2018.

Cash from operating activities in first-quarter 2019 was $308.6 million, up 18.99% from $259.4 million in the prior-year period.

Capital expenditure during the quarter was $299.1 million, higher than the year-ago level of $232.5 million.

Guidance

CNX Resources reiterated its 2019 capital expenditure guidance in the range of $1,000-$1,080 million. The company expects 2019 production in the range of 495-515 Bcfe, indicating a 5% increase from the 2018 level.

 

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates.

VGM Scores

At this time, CNX Resources has an average Growth Score of C, a grade with the same score on the momentum front. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, CNX Resources has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.



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