Ovintiv Q2 Earnings Miss Estimates, Revenues Increase Y/Y

Ovintiv Inc. OVV reported second-quarter 2025 adjusted earnings per share of $1.02, which missed the Zacks Consensus Estimate of $1.04. The bottom line also decreased from the year-ago level of $1.24. This underperformance was due to weaker oil price realizations and a 4% year-over-year increase in expenses during the quarter.   The Denver, CO-based oil and gas exploration and production company’s total revenues of $2.3 billion increased 1.3% from the year-ago quarter’s figure and beat the Zacks Consensus Estimate by 18.8%.  Higher contributions from sales of purchased products and strong gains from hedging drove the revenue growth. Ovintiv's board of directors declared a quarterly dividend of 30 cents per share, which will be paid on Sept. 30 to its shareholders of record as of Sept. 15, 2025.The company achieved higher-than-expected total average production in the second quarter, exceeding its guidance for all product types, including oil and condensate, other NGLs and natural gas.Ovintiv lowered its net debt by $217 million over the quarter, ending with an outstanding balance of approximately $5.3 billion. The company returned a combined $223 million to its shareholders through regular dividend payouts and share repurchases.Ovintiv Inc. Price, Consensus and EPS Surprise Ovintiv Inc. price-consensus-eps-surprise-chart | Ovintiv Inc. QuoteOVV’s Production & PricesTotal second-quarter production was 615,300 barrels of oil equivalent per day (BOE/d) compared with 593,800 BOE/d in the prior-year period. Moreover, the figure beat our prediction of 598,500 BOE/d.Natural gas production increased to 1,851 million cubic feet per day (MMcf/d) in the second quarter of 2025 from 1,740 MMcf/d in the prior-year quarter. Additionally, the figure beat our estimate of 1,818 MMcf/d.Total liquids production increased to 306.7 thousand barrels per day (Mbbls/d) in the second quarter of 2025 from 303.9 Mbbls/d in the second quarter of 2024. Furthermore, the figure beat our prediction of 295.5 Mbbls/d.In the second quarter of 2025, natural gas contributed approximately 50.1% and liquids accounted for about 49.9% of the total production.Ovintiv's realized natural gas price was $2.38 per thousand cubic feet compared with the year-ago level of $1.86. Realized oil price decreased to $65.23 per barrel from $76.58 in the second quarter of 2024.OVV’s Costs, Capex & Balance SheetTotal expenses in the reported quarter increased to $1.8 billion from the year-ago quarter’s figure of $1.7 billion. However, the figure was lower than our projection of $2.3 billion.Ovintiv’s cash from operating activities in the quarter under review was $1 billion, which decreased 0.7% from the year-ago figure.OVV's capital investments were $521 million compared with $622 million in the year-ago period. The company generated a non-GAAP free cash flow of $913 million in the reported quarter.As of June 30, the company had cash and cash equivalents worth $20 million and long-term debt of $4.4 billion. Its debt-to-capitalization was 29.7%.OVV’s Asset PerformanceIn the second quarter, average production from the Permian Basin reached approximately 215 MBOE/d, with liquids making up 80% of the total. A total of 23 net wells were brought online during the period. For the full year, capital spending in this region is projected between $1.20 billion and $1.25 billion, supporting the development of around 130-140 net wells.From the Montney play, second-quarter output averaged 300 MBOE/d, with liquids contributing about 26% of the volume. The company turned in line 39 net wells during the quarter. Full-year capital expenditures for Montney are expected to be between $575 million and $625 million, which is anticipated to fund 75-85 net well additions.In the Anadarko Basin, production during the second quarter was 100 MBOE/d, with a liquid mix of 59%. The company brought 11 net wells into production. Annual capital investment in Anadarko is estimated between $290 million and $310 million, aimed at bringing 25-35 net wells online.OVV’s Q3 and 2025 GuidanceOvintiv anticipates allocating a minimum of 50% of its non-GAAP free cash flow, after accounting for base dividends, to its shareholders through a mix of stock buybacks and/or variable dividend payments. The company expects total shareholder return in the third quarter of 2025 to be $235 million, comprising $158 million in share buybacks and $77 million in base dividends.This Zacks Rank #3 (Hold) company expects its total production for the third quarter of 2025 to be between 610 MBOE/d and 630 MBOE/d. This includes oil and condensate production between 202 Mbbls/d and 208 Mbbls/d, natural gas liquids production of 94-98 Mbbls/d and natural gas production between 1,875 MMcf/d and 1,925 MMcf/d. Capital investment for the third quarter is projected between $525 million and $575 million.The independent energy producer has reduced its full-year capital guidance while raising production estimate. For full-year 2025, the company anticipates total production to average between 600 MBOE/d and 620 MBOE/d. Full-year oil and condensate production is expected to range from 205 Mbbls/d to 209 Mbbls/d, while NGLs production is projected between 93 Mbbls/d and 96 Mbbls/d. Natural gas production for the year is estimated to be between 1,825 MMcf/d and 1,875 MMcf/d. The company expects its capital investment for the full year to be between $2.1 billion and $2.2 billion.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Important Earnings at a GlanceWhile we have discussed OVV’s second-quarter results in detail, let us take a look at three other key reports in this space.San Antonio, TX-based oil and gas refining and marketing service provider, Valero Energy Corporation VLO, reported second-quarter 2025 adjusted earnings of $2.28 per share, which beat the Zacks Consensus Estimate of $1.73. However, the bottom line declined from the year-ago quarter’s level of $2.71. The better-than-expected quarterly results can be attributed to an increase in refining margins per barrel of throughput and lower total cost of sales. The positives were partially offset by a decline in refining throughput volumes and renewable diesel sales volumes.The company had cash and cash equivalents of $4.5 billion at the end of the second quarter. As of June 30, 2025, it had a total debt of $8.4 billion and finance-lease obligations of $2.3 billion.Houston, TX-based oil and gas equipment and services provider, Halliburton Company HAL, reported second-quarter 2025 adjusted net income of 55 cents per share, which was in line with the Zacks Consensus Estimate but below the year-ago quarter’s profit of 80 cents (adjusted). The numbers reflect softer activity in the North American region, partly offset by international growth.As of June 30, 2025, the company had approximately $2 billion in cash/cash equivalents and $7.2 billion in long-term debt, representing a debt-to-capitalization ratio of 40.4. Halliburton reported second-quarter capital expenditure of $354 million, up from our projection of $338.2 million.Norway-based integrated oil and gas operator, Equinor ASA EQNR, reported second-quarter 2025 adjusted earnings per share of 64 cents, which missed the Zacks Consensus Estimate of 66 cents. The bottom line declined 25% from the year-ago quarter’s level of 84 cents. Weak quarterly results can be attributed to lower liquids production across major segments and reduced liquids prices. Natural declines and portfolio divestments in Nigeria and Azerbaijan also contributed to the decrease in overall production.As of June 30, 2025, the company reported $9,472 million in cash and cash equivalents. Its long-term debt was $24,505 million. During the same time, Equinor generated a negative net cash flow of $2,579 million compared with $4,022 million in the year-ago period. Equinor’s capital expenditures amounted to $3.4 billion in the second quarter.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They includeStock #1: A Disruptive Force with Notable Growth and ResilienceStock #2: Bullish Signs Signaling to Buy the DipStock #3: One of the Most Compelling Investments in the MarketStock #4: Leader In a Red-Hot Industry Poised for GrowthStock #5: Modern Omni-Channel Platform Coiled to SpringMost of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%.Download Atomic Opportunity: Nuclear Energy's Comeback free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Halliburton Company (HAL): Free Stock Analysis Report Valero Energy Corporation (VLO): Free Stock Analysis Report Equinor ASA (EQNR): Free Stock Analysis Report Ovintiv Inc. (OVV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks