Ormat Technologies (ORA) Down 7.8% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Ormat Technologies (ORA). Shares have lost about 7.8% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Ormat Technologies due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Ormat Technologies Q4 Earnings Miss, Revenues Up Y/Y

Ormat Technologies fourth-quarter 2019 adjusted earnings per share (EPS) came in at 24 cents, missing the Zacks Consensus Estimate of 56 cents by a massive 57.1%. Earnings also plummeted 42.9% from the prior-year quarter’s 42 cents per share.

Barring one-time items, the company’s GAAP earnings were 24 cents per share compared with the year-ago quarter’s 36 cents.

For 2019, Ormat Technologies’ operating EPS came in at $1.46, down 29.8% from the prior-year quarter’s $2.08. The reported figure also missed the Zacks Consensus Estimate of $1.77 by 17.5%.

Revenues

In the fourth quarter, Ormat Technologies generated revenues of $192.4 million, which exceeded the Zacks Consensus Estimate of $183.3 million by 5%. Also, the top line improved 1% on a year-over-year basis.

For 2019, Ormat Technologies’ revenues summed $746 million, up 3% from the prior-year quarter’s $719.3 million. The figure also outpaced the Zacks Consensus Estimate of $737 million by 1.22%.

Segment Revenues

Electricity Segment: Revenues increased 4.4% year over year to $144.4 million from the prior-year quarter’s $138.3 million.

Product Segment: Segment revenues declined 11.9% year over year to $43.8 million from the year-earlier quarter’s $49.7 million.

Other Segment: Revenues for this division surged 75.5% year over year to $4.3 million compared with the $2.4 million recorded in the prior-year quarter.

Operational Update

In the December-end quarter, Ormat Technologies’ total operating expenses were $20 million, down 12.3% year over year.

Operating income during the quarter totaled $54.5 million compared with the $68 million registered in the year-ago period.

The company’s total cost of revenues in the fourth quarter was $117.9 million, up 18.3% year on year.

Interest expenses were $17.6 million during the quarter, down 20.3% on a year-over-year basis.

Financial Condition

Ormat Technologies had cash and cash equivalents of $71.2 million as of Dec 31, 2019, compared with $98.8 million as of Dec 31, 2018.

Total long-term debt was $1,011.9 million as of Dec 31, 2019, compared with $1,040.7 million as of Dec 31, 2018.

Guidance 2020

Ormat Technologies projects full-year 2020 total revenues of $720-$740 million, with electricity segment revenues estimated at $560-$570 million. Likewise, the company’s Product segment revenues are expected to be $140-$150 million. The Zacks Consensus Estimate for the same is pegged at $787 million, higher than the company’s guided range.

The company also anticipates annual adjusted EBITDA of $405-415 million for 2020. It expects annual adjusted EBITDA attributable to minority interest to be approximately $26 million.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.