Hot Stock to Track: First Majestic Silver Corp. (NYSE: AG)

VANCOUVER, British Columbia, July 26, 2019 – Shares of First Majestic Silver Corp. (NYSE: AG) inclined 1.46% to $9.81. The stock traded total volume of 3.086M shares lower than the average volume of 3.79M shares.

First Majestic Silver Corp. (AG) reported first-quarter net income of $2.90M, after reporting a loss in the same period a year earlier. On a per-share basis, the Vancouver, British Columbia-based company said it had net income of 1 cent. Losses, adjusted for non-recurring gains, were 1 cent per share. The results matched Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was also for a loss of 1 cent per share.

Q1 2019 FINANCIAL RESULTS:

Revenues generated in the first quarter totaled $86.80M, a boost of 48% contrast to $58.60M in the first quarter of 2018 mainly because of the acquisition of the San Dimas mine in the second quarter of 2018, which resulted in a 60% increase in silver equivalent ounces sold, partially offset by a 6% decrease in average realized silver price contrast to the same quarter of the prior year.

The Company reported mine operating earnings of $10.30M contrast to ($0.40)M in the first quarter of 2018. The increase in mine operating earnings in the quarter was attributed to the San Dimas and Santa Elena mines, which generated mine operating earnings of $11.20M and $5.10M, respectively, mainly offset by losses at the Del Toro and La Parrilla mines because of reduced production levels.

Cash flow from operations before movements in working capital and income taxes in the quarter was $23.70M ($0.12 per share) contrast to $15.60M ($0.09 per share) in the first quarter of 2018.

The Company generated net earnings of $2.90M (EPS of $0.01) contrast to ($5.6)0M (EPS of $(0.03)) in the first quarter of 2018. Adjusted net earnings for the quarter was ($2.90)M (adjusted EPS of $(0.01)), after excluding non-cash and non-recurring items.

Cash and cash equivalents at March 31, 2019 was $91.50M, a boost of $34.50M contrast to the previous quarter, while working capital increased to $130.90M. The increase in cash and cash equivalents was mainly attributed to the sale of 5,250.0K common shares of the Company through its “at-the-market distribution” program at an average price of US$6.34 per share for gross proceeds of $33.60M, or net proceeds of $32.50M after costs.

OPERATIONAL HIGHLIGHTS:

Total production in the first quarter reached 6.273M silver equivalents ounces, consisting of 3,331,388.0M ounces of silver, 32,037 ounces of gold, 2.661M pounds lead and 1.265M pounds of zinc. Contrast to the previous quarter, total production reduced slightly by 3% because of lower throughput and production at the Del Toro and La Parrilla mines, partially offset by a boost in production from the La Encantada mine. Pure silver production increased 2% as a result of higher grades at the San Dimas and La Encantada mines.

COSTS AND CAPITAL EXPENDITURES:

Total capital expenditures in the first quarter were $28.70M, mainly consisting of $8.20M at San Dimas, $4.80M at Santa Elena, $2.90M at La Encantada, $2.40M at San Martin, $2.80M at La Parrilla, $1.00M at Del Toro and $6.60M for planned projects which includes about $6.00M for the purchase of two HIG mills.

AG has the market capitalization of $1.99B and its EPS growth ratio for the past five years was -31.03%. Price to sales ratio was 6.03.

Earnings Results Analysis: Precision Drilling Corporation (NYSE: PDS)

CALGARY, Alberta, July 5, 2019 – Shares of Precision Drilling Corporation (NYSE: PDS) declined -0.53% to $1.86. The stock traded total volume of 474.388K shares lower than the average volume of 1.05M shares.

Precision Drilling Corp. (PDS) reported first-quarter net income of $18.80M, after reporting a loss in the same period a year earlier.

Summary for the three months ended March 31, 2019:

  • Revenue this quarter was $434.0M which is 8% higher than the first quarter of 2018. The increase in revenue is mainly the result of higher activity and average day rates in our U.S. contract drilling business, offset by lower Canadian drilling activity. Contrast with the first quarter of 2018, our activity for the quarter, as measured by drilling rig utilization days increased by 23% in the U.S. while Canada reduced by 33% and international activity remained consistent. Revenue from our Contract Drilling Services and Completion and Production Services segments increased 8% and 12%, respectively.
  • Adjusted EBITDA for the quarter was $108.0M, a boost of $10.0M from the previous year. Our Adjusted EBITDA as a percentage of revenue was 25% this quarter, contrast with 24% in the comparative quarter of 2018. Adjusted EBITDA this quarter was positively influenced by higher activity and day rates in the U.S., changes to the recognition of lease-related expenses under IFRS 16 and lower share-based incentive compensation expense offset by lower Canadian drilling activity and restructuring costs of $6.0M regarding severance costs as we continued to align our cost structure to reflect reduced Canadian activity levels. With the adoption of IFRS 16, lease-related charges of $3.0M in the first quarter of 2019 were recognized through finance charges and depreciation and amortization expense. Historically, these charges were reflected in operating and general and administrative expense. Total share-based incentive compensation expense for the quarter was $9.0M contrast with $10.0M in the first quarter of 2018.
  • Operating earnings this quarter were $62.0M contrast with $10.0M in the first quarter of 2018. Operating earnings this quarter were positively influenced by the gain on asset disposals and impairment reversal from the disposition of our Mexico drilling equipment and changes to the recognition of lease-related expenses under IFRS 16 partially offset by restructuring costs.
  • General and administrative expenses this quarter were $31.0M, $2.0M higher than in 2018. The higher general and administrative costs in 2019 were because of the weakening of the Canadian dollar on our U.S. dollar denominated costs.
  • Net finance charges were $31.0M, a decrease of $1.0M contrast with the first quarter of 2018, mainly because of a reduction in interest expense related to the debt stepped down in 2018 and 2019, offset by the impact of the weakening of the Canadian dollar on our U.S. dollar denominated interest and $1.0M of lease accretion charges resulting from the adoption of IFRS 16 on January 1, 2019.
  • We realized revenue from international contract drilling of US$36.0M in the first quarter of 2019, in-line with the prior year period. Average revenue per utilization day in our international contract drilling business was US$49,940 consistent with the comparable prior year quarter. During the quarter, we signed three-year contract renewals for two rigs in Saudi Arabia, one-year extensions for two Kuwait rigs and sold our Mexico-based drilling assets for proceeds of US$48.0M resulting in a gain on sale of US$24.0M and a US$4.0M impairment reversal.
  • Directional drilling services realized revenue of $10.0M in the first quarter of 2019 contrast with $9.0M in the prior year period.
  • Funds offered by operations in the first quarter of 2019 were $96.0M, a decrease of $8.0M from the prior year comparative quarter of $104.0M. The decrease was mainly the result of the timing of $20.0M of cash interest payments as we did not have a first quarter interest payment on our senior notes due 2026 in 2018, partially offset by improved operating results.
  • Capital expenditures were $71.0M in the first quarter, a boost of $41.0M over the same period in 2018. Capital spending for the quarter included $66.0M for upgrade and expansion capital, mainly related to our sixth new-build rig for Kuwait and a U.S. new-build rig under long-term contract, and $5.0M for the maintenance of existing assets, infrastructure spending and intangibles.

PDS has the market capitalization of $546.43M and its EPS growth ratio for the past five years was -28.50%. The return on assets ratio of the Company was -6.70% while its return on investment ratio stands at -5.00%. Price to sales ratio was 0.45 while 45.90% of the stock was owned by institutional investors.

Hot Stock in Focus: Imperial Oil Limited (NYSE: IMO)

CALGARY, Alberta, June 25, 2019 – Shares of Imperial Oil Limited (NYSE: IMO) showed the bearish trend with a lower momentum of -1.87% to $27.83. The company traded total volume of 213.351K shares as contrast to its average volume of 309.15K shares. The company has a market value of $21.94B and about 788.48M shares outstanding.

Imperial Oil Ltd. (IMO) reported first-quarter profit of $220.40M. The Calgary, Alberta-based company said it had profit of 29 cents per share. The results did not meet Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of 38 cents per share. The oil and gas and petroleum products company posted revenue of $6.0B in the period.

The Company offered net profit margin of 6.00% while its gross profit margin was 20.50%. ROE was recorded as 8.70% while beta factor was 0.93. The stock, as of recent close, has shown the weekly upbeat performance of 3.11% which was maintained at 9.91% in this year.

Eye-Catching Stock Buzz: Helmerich & Payne Inc. (NYSE: HP)

TULSA, Okla., June 23, 2019 – Shares of Helmerich & Payne Inc. (NYSE: HP) gained 0.08% to $51.11. The stock grabbed the investor’s attention and traded 2.074M shares as compared to its average daily volume of 1.20M shares. The stock’s institutional ownership stands at 99.40%.

Helmerich & Payne, Inc. (HP) stated income of $61.0M or $0.55 per diluted share from operating revenues of $721.0M for the quarter ended March 31, 2019, contrast to income of $19.0M, or $0.17 per diluted share, on revenues of $741.0M for the quarter ended December 31, 2018. Net income per diluted share for the second and first fiscal quarters of 2019 include $(0.01) and $(0.25), respectively, of after-tax losses comprised of select items.

Net cash offered by operating activities was $200.0M for the second quarter of fiscal 2019 contrast to $209.0M for the first fiscal quarter of fiscal 2019.

HP has a market value of $5.59B while its EPS was booked as $0.65 in the last 12 months. The stock has 109.33M shares outstanding. In the profitability analysis, the company has gross profit margin of 35.20% while net profit margin was 2.60%. Beta value of the company was 1.50; beta is used to measure riskiness of the security. Analyst recommendation for this stock stands at 2.40.

Earnings Buzz: Houston American Energy Corp. (NYSE: HUSA)

HOUSTON, June 21, 2019 – Houston American Energy Corp. (NYSE American: HUSA) recently declared that net income for the fourth quarter of 2018 was $64.665K contrast to a net loss of $282.663K for the fourth quarter of 2017.  For the twelve months ended December 31, 2018, net loss was $251.336K contrast to a net loss of $2.037M for the twelve months ended December 31, 2017.

Oil and gas revenues were up 256% for the year, to $2.243M for 2018 as contrast to $630.392K in 2017.  The increase in revenues was attributable to production from the Company’s Reeves County, TX wells which came on line late in 2017. The Company’s commitment to lower operating costs and stringent financial controls had a positive impact during the year with general and administrative costs decreasing 33% to $1.422M in 2018 from $2.128M in 2017.

Other financial metrics improved in 2018, highlighted by:

  • Cash flow from operating activities of $360.792K for the year ended December 31, 2018 vs. cash used in operating activities of $1.716M for the year ended December 31, 2017
  • Proved reserve PV10 valuation of $7.714M at December 31, 2018 vs. $6.848M at December 31, 2017
  • Cash on hand of $755.702K at December 31, 2018 vs. $392.062K at December 31, 2017
  • A current ratio of 15:1 at December 31, 2018 vs. 5:1 at December 31, 2017
  • Total liabilities of $145.478K at December 31, 2018 vs. $236.560K at December 31, 2017; and no long-term debt.

Brief Overview on Company’s Performance: Freeport-McMoRan Inc. (NYSE: FCX)

On Tuesday, Shares of Freeport-McMoRan Inc. (NYSE: FCX) showed the bullish trend with a higher momentum of 3.63% to $11.13. The company traded total volume of 24.906K shares as contrast to its average volume of 20.07M shares. The company has a market value of $16.42B and about 1.48B shares outstanding.

Freeport-McMoRan Inc. (FCX) stated net income attributable to common stock of $31.0M ($0.02 per share) in first-quarter 2019. After adjusting for net charges of $36.0M ($0.03 per share), adjusted net income attributable to common stock totaled $67.0M ($0.05 per share) in first-quarter 2019.

Consolidated Sales Volumes:

First-quarter 2019 copper sales of 784.0M pounds and gold sales of 242.0K ounces were about five percent lower than January 2019 sales estimates of 825.0M pounds of copper and 255.0K ounces of gold, reflecting impacts from weather events at El Abra, unplanned maintenance in North America and timing of shipments in Indonesia. First-quarter 2019 copper and gold sales were lower than first-quarter 2018 sales volumes mainly reflecting anticipated lower mill rates and ore grades as PT Freeport Indonesia (PT-FI) transitions mining from the open pit to underground.

First-quarter 2019 molybdenum sales of 22.0M pounds were lower than the January 2019 estimate and first-quarter 2018 sales of 24.0M pounds.

Sales volumes for the year 2019 are expected to approximate 3.30B pounds of copper, 0.80M ounces of gold and 94.0M pounds of molybdenum, counting 800.0M pounds of copper, 265.0K ounces of gold and 25.0M pounds of molybdenum in second-quarter 2019. As PT-FI transitions mining from the open pit to underground, its production is expected to be significantly lower in 2019 and 2020, contrast with 2018. Metal production is expected to improve significantly by 2021 following a ramp-up period.

Capital Expenditures:

Capital expenditures totaled $622.0M in first-quarter 2019 (counting about $370.0M for major mining projects).

Capital expenditures are expected to approximate $2.50B for the year 2019, counting $1.50B for major mining projects mainly associated with underground development activities in the Grasberg minerals district and development of the Lone Star project, and exclude estimates associated with the new smelter in Indonesia. A large portion of the capital expenditures relate to projects that are expected to add noteworthy production and cash flow in future periods, enabling FCX to generate operating cash flows surpassing capital expenditures in future years. FCX has cash on hand and the financial flexibility to fund these expenditures and will continue to be disciplined in deploying capital.

Debt:

 At March 31, 2019, FCX’s consolidated debt totaled $9.90B, with a related weighted-average interest rate of 4.7 percent. FCX had no borrowings, $13.0M in letters of credit issued and $3.50B available under its revolving credit facility at March 31, 2019.

During first-quarter 2019, FCX redeemed its entire outstanding $1.0B aggregate principal amount of 3.100% Senior Notes due 2020 and repaid $200.0M under Cerro Verde’s credit facility. FCX recorded losses on early extinguishment of debt totaling $6.0M in first-quarter 2019.

The Company offered net profit margin of 11.00% while its gross profit margin was 23.10%. ROE was recorded as 19.80% while beta factor was 2.27. The stock, as of recent close, has shown the weekly upbeat performance of 4.80% which was maintained at 7.95% in this year.

Eye-Catching Hot Stock: Ecolab Inc. (NYSE: ECL)

On Friday, Shares of Ecolab Inc. (NYSE: ECL) showed the bullish trend with a higher momentum of 0.06% to $198.87. The company traded total volume of 749.687K shares as contrast to its average volume of 1.01M shares. The company has a market value of $57.29B and about 288.08M shares outstanding.

Ecolab Inc. (ECL) stated first-quarter profit of $296.50M. On a per-share basis, the Saint Paul, Minnesota-based company said it had net income of $1.01. Earnings, adjusted for one-time gains and costs, came to $1.03 per share. The results topped Wall Street expectations. The average estimate of 10 analysts surveyed by Zacks Investment Research was for earnings of $1.02 per share.

The cleaning, food-safety and pest-control services company posted revenue of $3.510B in the period, which did not meet Street forecasts. Six analysts surveyed by Zacks expected $3.570B. For the current quarter ending in July, Ecolab anticipates its per-share earnings to range from $5.80 to $6. Analysts surveyed by Zacks had forecast adjusted earnings per share of $1.42.

The Company offered net profit margin of 10.10% while its gross profit margin was 41.30%. ROE was recorded as 18.50% while beta factor was 0.86. The stock, as of recent close, has shown the weekly upbeat performance of 0.06% which was maintained at 34.96% in this year.

Hot Move to Watch: Encana Corporation (NYSE: ECA)

On Friday, Shares of Encana Corporation (NYSE: ECA) declined -5.67% to $4.66. The stock traded total volume of 28.807M shares higher than the average volume of 25.39M shares.

Encana (NYSE, TSX: ECA) recently declared its first quarter 2019 financial and operating results.

First Quarter Summary:

For the first quarter of 2019, Encana posted a net loss of $245.0M, or $0.20 per share. The primary drivers associated with the loss before tax was non-cash unrealized losses on risk management of $427.0M, restructuring costs of $113.0M and acquisition related costs of $31.0M. Non-GAAP operating earnings for the first quarter were $165.0M, or $0.14 per share.

Cash from operating activities for the first quarter was $529.0M. Non-GAAP cash flow was $422.0M, a six percent increase over the comparable period of 2018. Non-GAAP cash flow was influenced by $144.0M of restructuring and acquisition costs.

Through the end of the first quarter, the Company had repurchased 55.90M shares of Encana common stock at an average price of $7.16 per share. Encana has continued to execute the buyback in April and year-to-date has repurchased a total of 91.00M shares at an average price of $7.19 per share. Investment in the program has totaled $654.0M.

At the end of the first quarter, Encana had more than $4.40B of total liquidity counting about $479.0M in cash and cash equivalents and $4.00B available credit on the Company’s undrawn credit facilities.

Encana reiterated its 2019 proforma capital guidance of $2.7 to $2.90B. First quarter proforma upstream capital expenditures totaled $913.0M and were in line with previous expectations. Investment in the first quarter was mainly driven by high activity levels in the Anadarko Basin at the time of the Newfield acquisition close and front-end weighted capital programs in the other assets.

ECA has the market capitalization of $7.14B and its EPS growth ratio for the past five years was 28.30%. The return on assets ratio of the Company was 4.00% while its return on investment ratio stands at 13.40%. Price to sales ratio was 1.22 while 67.20% of the stock was owned by institutional investors.