Key Highlights

  • Shares are trading down 13.51% at $2.47 versus a prior close of $2.85.
  • Adjusted Earnings were $0.06 per share against market estimates of $0.13.
  • Fourth-quarter guidance is 60,000 to 64,000 boepd versus 69,200 in the third quarter.

Kosmos Energy (NYSE:KOS) shares are trading down 13.51% at $2.47 after third-quarter results fell short of market estimates and fourth-quarter production guidance pointed lower. The stock remains well above its 52-week low of $0.84 but below the 52-week high of $3.34.

Kosmos is a Dallas-based deepwater exploration and production company with oil and gas output offshore Ghana, Mauritania and Senegal, and in the Gulf of America. Its production includes the Jubilee and TEN fields in Ghana and the Greater Tortue Ahmeyim LNG project.

Earnings Miss and Lower Fourth-Quarter Output Weigh on Shares

Kosmos reported a third-quarter net loss of $43 million, or $0.07 per share, and adjusted Net Income of $35 million, or $0.06 per share, versus market estimates of $0.13. Revenue was $410 million against estimates near $466 million. Net production averaged about 69,200 barrels of oil equivalent per day, up about 6% from a year earlier.

Fourth-quarter production guidance of 60,000 to 64,000 boepd reflects planned Delta House platform maintenance, a Kodiak-1 Well Workover and Jubilee decline management. Crude Oil prices also fell more than 6% on hopes of U.S.-Iran diplomacy, adding pressure to the sector.

Reserve-Based Lending Facility Extended to 2033

Kosmos separately completed the amendment and extension of its $1.2 billion reserve-based lending facility, pushing final Maturity from December 2029 to April 2033 with $750 million drawn at close. Pricing is SOFR plus 4.5% for the first three years, 0.25% lower than before, and the facility was oversubscribed. No scheduled amortization begins until 2031.

Third-quarter free Cash Flow was about $90 million, bringing the year-to-date total to $193 million, and the company exited the quarter with net Debt of about $2.47 billion and Liquidity of about $570 million.

Net Debt Target and 2028 Bonds Stay in Focus

Management expects year-end net debt below $2.4 billion, a reduction of about 20% for 2026, and said it will now look to address its 2028 bond maturities. The company has hedged 8 million barrels of 2027 oil production with an average floor near $68 and a ceiling near $84 per barrel. Jefferies carries a price target of $2.90 on the stock.