Hot Stock That Must Be in Your Portfolio: Legacy Reserves LP (NASDAQ: LGCY)

On Tuesday, Shares of Legacy Reserves LP (NASDAQ: LGCY) declined -0.32% to $6.15. The stock recorded $6.13 as its minimum price and hit the max level of $6.26, during its most recent trading session. It traded total volume of 271.6K shares lower than the average volume of 938.78K shares.

Legacy Reserves LP (LGCY) recently declared first quarter results for 2018.

Financial and Operating Results – Three-Month Period Ended March 31, 2018 Contrast to Three-Month Period Ended March 31, 2017:

  • Production increased 9% to 46.078K Boe/d from 42.422K Boe/d mainly because of additional oil production from our horizontal drilling operations in Howard County, Texas and Lea County, New Mexico and production attributable to the additional working interests that reverted to us in connection with making an acceleration payment (the “Acceleration Payment”) under our amended and restated joint development agreement with TSSP. This was partially offset by natural production declines and individually immaterial divestitures accomplished in 2018 and 2017.
  • Production expenses, excluding ad valorem taxes, reduced to $45.60M in 2018 from $49.20M in 2017, mainly because of cost containment efforts across all operating regions partially offset by increased well count related to our Permian horizontal drilling program and expenses associated with the additional working interests that reverted to us in connection with making the Acceleration Payment. On an average cost per Boe basis, production expenses excluding ad valorem taxes reduced 15% to $10.99 per Boe in 2018 from $12.89 per Boe in 2017.
  • General and administrative expenses, excluding unit-based Long-Term Incentive Plan (“LTIP”) compensation expense, increased to $11.30M in 2018 from $8.70M in 2017 because of general cost increases. LTIP compensation expense increased $10.90M because of the recent rise in our unit price.
  • Cash settlements paid on our commodity derivatives during 2018 were $2.80M contrast to cash receipts of $4.20M in 2017. The change in cash settlements is a result of the combination of higher commodity prices and reduced nominal volumes hedged in Q1 2018 contrast to Q1 2017 as well as lower contracted hedge prices.
  • Total development capital expenditures increased to $59.70M in 2018 from $23.70M in 2017. The 2018 activity was comprised mainly of our horizontal drilling program in Lea County, NM and Howard County, TX.

LGCY has the market capitalization of $476.75M and its EPS growth ratio for the past five years was -22.10%. The return on assets ratio of the Company was -1.70% while its return on investment ratio stands at 2.00%. Price to sales ratio was 1.01 while 18.70% of the stock was owned by institutional investors.

Marion Frost

Marion Frost

I am Marion Frost and I have over 16 years experience in the financial services industry giving me a vast understanding of how news affects the financial markets. I am an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.