Yahoo Finance TC Energy's (TRP) Q4 Earnings Miss Estimates, Revenues Up Y/Y
TC Energy (TRP) reported fourth-quarter adjusted earnings of 82 cents per share, marginally underperforming the Zacks Consensus Estimate of 84 cents. TC Energy’s bottom line also reduced from a profit of 84 cents per share in the year-ago period. This underperformance could be attributed to weak results in the Liquids Pipeline segment.
TC Energy’s comparable EBITDA of C$2.7 billion in the reported quarter was up from C$2.4 billion in the prior-year period.
This North America-based energy infrastructure provider’s quarterly revenues of $3 billion increased approximately 2% year over year due to solid segmental performances.
TC Energy’s board of directors announced a quarterly dividend increase of 93 Canadian cents per common share for the quarter ending Mar 31, 2023.
TC Energy Corporation Price, Consensus and EPS Surprise
TC Energy Corporation price-consensus-eps-surprise-chart | TC Energy Corporation Quote
Segmental Information
Canadian Natural Gas Pipelines reported a comparable EBITDA of C$768 million, up about 14% from the year-ago quarter’s level. This increase was primarily due to the impact of increased rate-based earnings on the NGTL System.
U.S. Natural Gas Pipelines’ comparable EBITDA of C$1.1 million indicates a 10.5% increase from the prior-year quarter’s level. This upside can be attributed to a stronger U.S. dollar in 2022.
Mexico Natural Gas Pipelines’ comparable EBITDA of C$211 million was up 39.8% from the year-ago quarter’s figure of C$151 million. This increase could be attributed to NGTL system’s continued growth as well as contributions from the BDR North and 2 East pipelines.
Liquids Pipelines' comparable EBITDA of C$364 million in the reported quarter deteriorated from the year-ago quarter’s level of C$380 million. This downtrend was due to contracted volumes in the Keystone Pipeline System’s U.S. Gulf Coast section as well as lower contributions from liquids marketing activities due to soft margins.
Power and Storage posted a comparable EBITDA of C$203 million, up 20.9% from the year-ago quarter’s figure of C$168 million. This segment has experienced significant growth due to several factors. Operational excellence, with a strong performance from Cogen operations, resulted in peak power plant availability during high-demand times, such as the coldest days in December. This caused record power pool prices in Alberta, which contributed to higher earnings for the segment.
Expenditure and Balance Sheet
TC Energy’s capital investments for the reported quarter totaled C$3.1 billion.
TRP had cash and cash equivalents worth C$620 million and long-term debt of C$39.6 billion, representing a debt-to-capitalization of 57.8%.
Key Updates
TC Energy is expecting to invest between C$11.5 billion and C$12 billion in capital growth projects in 2023.
TC Energy plans to continue investing in renewable energy and power generation projects, which will help to diversify its business and support the transition to a low-carbon economy.
It also expects to continue growing its business in 2023, particularly in its Natural Gas and Oil Pipelines segments. The company has several new projects under development that are expected to contribute to this growth, including the Coastal GasLink pipeline and the Keystone XL pipeline.
Zacks Rank and Key Picks
Currently, TC Energy carries a Zacks Rank #3 (Hold). Investors interested in the energy sector might look at some better-ranking stocks like ProPetro Holding PUMP sporting a Zacks Rank #1 (Strong Buy) and Helmerich & Payne (HP) and Energy Transfer ET bothholding a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.
ProPetro Holding: PUMP currently has a forward P/E ratio of 4.49. In comparison, its industry has an average forward P/E of 25.60, which means PUMP is trading at a discount to the group.
ProPetro Holding is worth approximately $1.14 billion. Its shares have declined 19.9% in the past year.
Energy Transfer LP: Energy Transfer LP is valued at around $39.66 billion. ET delivered an average earnings surprise of 28.7% for the last four quarters, and its current dividend yield is 9.50%.
Energy Transfer LP currently has a forward P/E ratio of 8.95. In comparison, its industry has an average forward P/E of 14.20, which means Energy Transfer LP is trading at a discount to the group.
Helmerich & Payne: Helmerich & Payne is valued at around $4.78 billion. Helmerich & Payne, headquartered in Tulsa, OK, has a trailing four-quarter earnings surprise of roughly 130.98% on average.
Over the past 60 days, the Zacks Consensus Estimate for HP's fiscal 2023 earnings has been revised by 18.8%. In the past year, HP stock has increased by 34.7%.
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