Antero Resources (AR) Q4 Results - Feb 13
Posted: Thu Feb 13, 2020 11:36 am
I have officially dropped AR from the Sweet 16, but I will continue following it. AM is still in our High Yield Income Portfolio.
AR's Q4 results were good as expected.
From Stifel: Antero Resources Corporation (AR, $1.77, Buy; Target $4.00)
Good Quarter. Waiting for an Asset Sale and Refinancing. - Jane Trotsenko
"We view yesterday's quarterly update as slightly positive. Despite missing production by 4%, Antero reported an adj. EBITDA beat of 9% driven by slightly better than expected price realizations and meaningfully lower operating expenses. Looking forward, production outlook for 2020 remains robust at 9% y/y production growth, while D&C capex was revised $25 mm lower. Per-unit operating expenses continue to improve after peaking in 2Q19 driven by lower midstream fees, water savings, and economies of scale. The company is targeting FCF neutrality this year including $125 mm in water earnout. The management team did not provide an update on asset sales, but noted that it is targeting a mid-2.0x leverage ratio with a materially improved liquidity profile by YE20, which is indicative of high confidence in their ability to deliver $0.75-1.0B in asset sales. Intl. NGL pricing, asset sales, and refinancing remain the key events to watch for this name."
I will be posting updated forecast/valuation models for AR and AM to our website later today.
AR's Q4 results were good as expected.
From Stifel: Antero Resources Corporation (AR, $1.77, Buy; Target $4.00)
Good Quarter. Waiting for an Asset Sale and Refinancing. - Jane Trotsenko
"We view yesterday's quarterly update as slightly positive. Despite missing production by 4%, Antero reported an adj. EBITDA beat of 9% driven by slightly better than expected price realizations and meaningfully lower operating expenses. Looking forward, production outlook for 2020 remains robust at 9% y/y production growth, while D&C capex was revised $25 mm lower. Per-unit operating expenses continue to improve after peaking in 2Q19 driven by lower midstream fees, water savings, and economies of scale. The company is targeting FCF neutrality this year including $125 mm in water earnout. The management team did not provide an update on asset sales, but noted that it is targeting a mid-2.0x leverage ratio with a materially improved liquidity profile by YE20, which is indicative of high confidence in their ability to deliver $0.75-1.0B in asset sales. Intl. NGL pricing, asset sales, and refinancing remain the key events to watch for this name."
I will be posting updated forecast/valuation models for AR and AM to our website later today.