Weekly Performance Update On 6 Foreign Integrated Oil And Gas Companies

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Includes: BP, E, RDS.A, STO, SU, TOT
by: Power Hedge

Crude oil prices increased relatively steadily over the past week, although they did fall slightly on Friday. This roughly corresponds with the action in the overall market as measured by the S&P 500. The stock index did show somewhat more volatility, however. It also increased over the course of the week. As usual though, this overall market action had different effects on the six foreign integrated oil and gas stocks that I follow in this weekly series.

Statoil (STO) opened at $23.28 on July 16, 2012. The stock closed at $24.16 in after hours trading on July 20, 2012. Stockholders in the company thus profited from a gain of $0.88 per ADR share or 3.78% over the week. Statoil opened at $22.50 on June 25, 2012. This gives the stock a trailing four-week gain of $1.66 or 7.38%. Statoil will announce its quarterly results later this week on July 26. In many cases, earnings announcements result in a stock making fairly large moves either upward or downward depending on these results. Statoil historically has been an exception to this and the stock tends to remain relatively stable on earnings (although it could deliver a slight movement on the news).

STO 5-Day Chart

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Source: Fidelity Investments

STO 4-Week Chart

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Source: Fidelity Investments

BP plc (BP) opened the week at $41.38. The stock closed at $41.46 in after hours trading on July 20. This gives BP shareholders a gain of $0.08 or 0.20% over the week. BP opened at $37.77 on June 25. Thus, shareholders of BP stock experienced a gain of $3.69 or 9.77% over the trailing four-week period.

BP 5-Day Chart

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Source: Fidelity Investments

BP 4-Week Chart

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Source: Fidelity Investments

Total S.A. (TOT) opened on July 16, 2012 at $43.88 per share. The stock closed at $44.05 in after hours trading on July 20. This gives ADR shareholders a gain of $0.17 or 0.39% for the week. Total opened on June 25 at $42.38. Thus, stockholders have seen a gain of $1.67 or 3.94% over the past four weeks. Total's stock has been flatter than many of its peers over the trailing four weeks. This could make the stock a relative bargain, particularly with its high dividend yield.

TOT 5-Day Chart

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Source: Fidelity Investments

TOT 4-Week Chart

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Source: Fidelity Investments

Suncor (SU) opened on July 16 at $28.96. The stock closed at $30.02 in after hours trading on July 20. This gives the stock a gain of $1.06 or 3.66% for the week. The stock opened on June 25, 2012 at $26.95. Thus, Suncor stock has seen a gain of $3.07 or 11.39% over the trailing four week period. Suncor will announce its quarterly results on July 24. I would not be surprised to see production increase, although profit may still be lower than in the preceding quarter due to the lower prevailing energy prices during the second quarter. An earnings surprise to the upside could send the stock higher. Suncor is still undervalued at this level however due to the company's growth prospects going forward.

SU 5-Day Chart

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Source: Fidelity Investments

SU 4-Week Chart

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Source: Fidelity Investments

Royal Dutch Shell (RDS.A) opened at $68.96 on July 16, 2012. The stock closed at $69.33 in after hours trading on Friday, July 20. Shareholders thus saw a gain of $0.37 or 0.54% for the week. The stock opened at $64.70 on June 25, 2012. Shareholders thus experienced a capital gain of $4.63 per share or 7.16% over the four-week period.

RDS.A 5-Day Chart

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Source: Fidelity Investments

RDS.A 4-Week Chart

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Source: Fidelity Investments

Eni (E) opened at $40.96 on July 16. The stock closed at $39.80 in after hours trading on Friday, July 20. This gives shareholders a loss of $1.16 or 2.91% for the week. As with last week, Eni was thus the only one of these six stocks to see a loss this week. The stock opened at $39.48 on June 25, 2012. Shareholders thus profited from a gain of $0.32 per share or 0.81% over the trailing four-week period.

E 5-Day Chart

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Source: Fidelity Investments

E 4-Week Chart

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Source: Fidelity Investments

With the exception of Eni, every one of these six stocks saw a share price gain over the past week. Statoil was the best performer of the group with Suncor in a very close second. All of the rest had very small share price gains by comparison. Eni was the worst performer of the group by far and the only one to see a loss over the last week. Suncor was the best performer of these six over the trailing four-week period. Eni was the worst performer over the trailing four-week period by a significant margin. Suncor and Statoil will both report their respective quarterly results this week. I expect to see both companies report lower profits than the preceding quarter due to the lower average energy prices that prevailed during this quarter compared to the previous one. With that said, both Statoil and Suncor are among my highest conviction holdings in this sector. If the stocks dip on the results then this could present a buying opportunity in these two names.

Disclosure: I am long STO, BP, SU.