A month has gone by since the last earnings report for MPLX LP (MPLX). Shares have added about 6.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MPLX LP due for a pullback? 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 catalysts.
MPLX LP Q3 Earnings and Revenues Lag Estimates
MPLX reported third-quarter 2024 earnings of $1.01 per unit, which missed the Zacks Consensus Estimate of $1.06. The bottom line, however, increased from the year-ago figure of 89 cents.
Total quarterly revenues of $2.97 billion missed the Zacks Consensus Estimate of $3.06 billion. The top line, however, increased from the prior-year level of $2.91 billion.
Lower-than-expected quarterly results were mainly due to higher depreciation and amortization costs and increased general and administrative expenses. The negatives were partially offset by higher throughput and increased gathered and processed volumes.
Segmental Highlights
MPLX’s adjusted EBITDA from the Logistics and Storage segment increased to $1.16 billion from $1.09 billion a year ago. The growth was driven by increased rates and higher throughputs, including growth from equity affiliates. Total pipeline throughputs in the quarter were 6 million barrels per day, up 1% from the prior-year level.
Adjusted EBITDA from the Gathering and Processing segment amounted to $557 million, up from $505 million a year ago. The increase can be primarily attributed to higher gathered and processed volumes, including contributions from its acquired assets in the Utica Basin and Permian Basin.
Gathering throughput volumes averaged 6.7 billion cubic feet per day (Bcf/d), implying an 8% increase from the year-ago level. Natural gas processed volumes came in at 9.8 Bcf/d, reflecting a 9% increase from the year-ago quarter’s level.
Costs and Expenses
Total costs and expenses amounted to $1.7 billion, down from the year-ago reported figure of $1.76 billion. The decrease was primarily due to a reduction in operating expenses (including purchased product costs).
Cash Flow
Distributable cash flow in the quarter totaled $1.45 billion, providing 1.5X distribution coverage. The figure increased from $1.37 billion in the year-ago quarter.
Adjusted free cash flow declined to $876 million from $1 billion in the corresponding period of 2023.
Balance Sheet
As of June 30, 2024, the partnership’s cash and cash equivalents were $2.43 billion, and its total debt amounted to $22.1 billion.
Outlook
MPLX expects capital spending for 2024 to be above $1 billion.
It turns out, fresh estimates have trended upward during the past month.
Currently, MPLX LP has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, MPLX LP has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
MPLX LP is part of the Zacks Oil and Gas - Production and Pipelines industry. Over the past month, Enbridge (ENB), a stock from the same industry, has gained 5.1%. The company reported its results for the quarter ended September 2024 more than a month ago.
Enbridge reported revenues of $10.91 billion in the last reported quarter, representing a year-over-year change of +48.7%. EPS of $0.40 for the same period compares with $0.46 a year ago.
Enbridge is expected to post earnings of $0.52 per share for the current quarter, representing a year-over-year change of +10.6%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.6%.
Enbridge has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
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