Wed, Apr. 15, 2:56 PM
- The oil price recovery may not be as strong as expected, Goldman Sachs says as it recommends buying stocks that do not need a V-shaped rebound such as Diamondback Energy (FANG +2.2%), Rice Energy (RICE +5.9%) and RSP Permian (RSPP +3.6%).
- Goldman expects the $55-$65/bbl WTI crude price level at which producers begin adding rigs ultimately will surprise the market and cause prices to stagnate at sub-$70 levels, so instead of positioning in high beta producers, hoping to capitalize on the sector’s historic 70%-80% correlation with the commodity, the firm recommends gaining exposure to low-cost E&Ps capable of strong growth absent a commodity recovery.
- Goldman tags stocks that are more dependent on further gains in oil prices, such as Denbury Resources (DNR +7.3%), Oasis Petroleum (OAS +3%) and SandRidge Energy (SD +5.8%), with Sell ratings.
Mon, Mar. 23, 5:37 PM
Fri, Mar. 13, 6:05 PM
- Data center owner Equinix (NASDAQ:EQIX), real estate trust SL Green (NYSE:SLG), and apparel maker Hanesbrands (NYSE:HBI) will be joining the S&P 500 after the March 20 close. Medical distributor Henry Schein (NASDAQ:HSIC) will be joining after the March 17 close.
- Leaving the index are oil/gas producer Denbury Resources (NYSE:DNR), energy services provider Nabors (NYSE:NBR), beauty product maker Avon (NYSE:AVP), and medical device maker CareFusion (about to be acquired). Denbury, Nabors, and Avon will be joining the S&P MidCap 400, taking Equinix, SL Green, and Hanesbrands' spots.
- Also: Buffalo Wild Wings (NASDAQ:BWLD) is taking Henry Schein's place in the S&P 400 on March 17, and Talmer Bancorp (NASDAQ:TLMR) Buffalo Wild Wings' spot in the S&P SmallCap 600.
- EQIX +2.1% AH. SLG +2%. HBI +3.7%. TLMR +3.6%. NBR -1.8%.
Thu, Feb. 19, 3:58 PM
- Denbury Resources (DNR +4.7%) powers through early losses and is now sporting strong gains after Q4 earnings beat estimates and reaffirming that it will cut capital spending by 50% in 2015 while keeping dividend rates steady.
- Despite current challenges, DNR highlighted some positives in its earnings call, including a 7% increase in 2014 production from enhanced oil recovery - which involves injecting carbon dioxide to pressurize mature oil fields - to more than 41K bbl/day, a new record.
- Total Q4 oil production averaged nearly 75K boe/day, up 5% Y/Y; cost per boe has been reduced to $22.64, down 14% Y/Y - an important result because producing oil using EOR can increase costs as much as $20-$30/bbl just for the carbon dioxide alone.
- Production guidance for 2015 is 72.5K-75.5K boe/day, with capital spending of ~$550M.
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Mon, Feb. 2, 11:49 AM
- Sterne Agee's Tim Rezvan analyzed the hedge portfolios of E&P companies who are very much "in the money" and formally aggregated estimated values of hedge portfolios for companies he covers, and his results show the values vary widely across the group.
- Among the oil-focused producers, Denbury Resources (DNR +8.1%) is far and above all others with a hedge portfolio worth $811M, 33% of current market cap; other standouts include Gastar Exploration (GST +5.5%), Oasis Petroleum (OAS +6.2%), Carrizo Oil & Gas (CRZO +5.4%) and Approach Resources (AREX +9.1%).
- Rezvan says he expects rhetoric to continue from operators over the next three months on monetizing all or some hedges to raise cash. saying "the question will be if operators go naked on the hedge side in an outright bet on an oil price rebound, or if they simultaneously layer in costless collars around strip pricing."
Wed, Jan. 28, 3:59 PM
- Energy stocks are broadly lower as Nymex crude oil futures fell another $1.68/bbl (-3.6%) to $44.53 after today's inventory report showed the largest weekly supply buildup since 1982, but drilling contractor are whacked with especially large losses.
- Examples: NBR -11.7%, PTEN -8.6%, PES -10.9%, PDS -12.3%, KEG -6.5%; Helmerich & Payne (NYSE:HP), which reportedly has launched a round of steep layoffs, -6.3%.
- Among independent producers: DNR -9.7%, NFX -4.6%, SM -8.6%, SGY -10%, SD -9.7%, EOG -5.3%, PXD -6.8%, QEP -6%, APC -4.2%, XEC -3%.
- ETFs: XLE, ERX, VDE, OIH, XOP, ERY, FCG, DIG, GASL, DUG, IYE, XES, IEO, IEZ, PXE, PXI, FENY, PXJ, RYE, FXN, DDG
Tue, Jan. 27, 4:38 PM
Tue, Jan. 27, 12:58 PM
- Marathon Oil (MRO -1.3%), Cobalt International Energy (CIE -0.3%) and RSP Permian (RSPP +0.8%) are downgraded to Neutral from Buy at UBS, as the firm cuts its 2015 Brent/WTI crude forecasts to a respective $52.50/bbl and $49/bbl, and lowers 2016 Brent/WTI crude estimates to $67.50 and $62.50.
- UBS also is cautious on several energy names with large free cash flow deficits, slowing growth profiles and rich relative valuations: COP, DVN, MUR, UPL, RRC, DNR, MHR.
- The firm's top Buys are APC, CHK and EOG.
Wed, Jan. 21, 2:03 PM
- “Companies will start to sell off the family silver” amid sustained low oil prices, and Halcon Resources (NYSE:HK) and Goodrich Petroleum (NYSE:GDP) are among energy companies that need to keep an eye on their liquidity the most and are thus the most likely candidates to sell assets, analysts say.
- HK has the most debt relative to its market value among similar-sized North American peers, according to Bloomberg data, and its plan to cut 2015 drilling to just three rigs vs. earlier plans for as many as 11 opens up the possibility that it could try to sell some of the acreage where it is not currently drilling, SunTrust's Neal Dingmann says.
- Analysts also tab Clayton Williams Energy (NYSE:CWEI), Denbury Resources (NYSE:DNR) and Penn West Petroleum (NYSE:PWE) as energy companies most likely to sell assets.
- Also, Dingmann names top Bakken producers Continental Resources (NYSE:CLR) and Whiting Petroleum (NYSE:WLL) as potential targets of takeover interest as producers with stronger balance sheets that have become more affordable with oil’s plunge; other analysts mention Carrizo Oil & Gas (NASDAQ:CRZO) and PDC Energy (NASDAQ:PDCE) as potential candidates.
Mon, Jan. 5, 12:18 PM
- Energy stocks severely underperform the broader market, with the sector -4.2% vs. the S&P 500's -1.4%, as U.S. oil prices briefly slip below $50/bbl for the first time since April 2009; Nymex crude recently was -4.4% at $50.37, while Brent crude -5.9% at $53.08.
- Among the day's biggest losers: DNR -9%, RIG -7.6%, NBR -4.8%, CHK -5.9%, SDRL -9.1%, SD -12.3%, NOV -5.9%, PSX -6.2%, APA -5.9%, DVN -4.4%, EOG -6%, SU -5.2%, OXY -4.2%, APC -8.7%, PWE -9%, ECA -5.5%, MRO -5.3%.
- Global oil majors, which have been seen as less vulnerable to falling oil prices, are posting big losses: XOM -2.7%, COP -4.5%, CVX -3.8%, BP -5.8%, RDS.A -4.6%, TOT -6.5%.
- ETFs: USO, XLE, OIL, UCO, ERX, VDE, OIH, SCO, XOP, ERY, FCG, DIG, PBW, BNO, GASL, DTO, DBO, DUG, IYE, XES, IEO, QCLN, IEZ, UWTI, PXE, USL, PXI, FENY, DWTI, PXJ, DNO, PSCE, RYE, SZO, PUW, FXN, OLO, DDG, HECO, TWTI, OLEM
Thu, Jan. 1, 2:19 AM
- Dow: INTC +41%; UNH +35%; HD +28%; CSCO +25%; MSFT +25%.
- S&P 500: LUV +125%; EA +106%; EW +95%; AGN +92%; AVGO +91%.
- Nasdaq: AAL +112%; EA +106%; AVGO +91%; GMCR +78%; ILMN +68%.
Dec. 19, 2014, 5:36 PM
Dec. 10, 2014, 12:58 PM
- Energy stocks are slammed across the board as oil prices take another nosedive (I, II), with the losses heaviest on shares of small, U.S.-based oil and gas producers.
- “Financial leverage is being thrown out the window, and everything else is being purged as well,” says Simmons analyst Bill Herbert, who adds that cuts to production budgets in the coming year likely will mean more pain for oil service companies.
- Among the hardest-hit shares: TPLM -15.2%, CRK -12.4%, GDP -11.9%, NOG -9.5%, AREX -8.6%.
- Investors have been less quick to dump shares of integrated oil companies, but today they have been smacked too: XOM -2.8%, CVX -2.9%, COP -2.3%, BP -2%, RDS.A -2.2%, TOT -2.3%.
- Today's worst performers on the S&P 500 include OKE -8.2%, DNR -7.4%, NE -5.6%.
- Service companies also are down: SLB -2.6%, HAL -2.7%, WFT -6.6%, BHI -2%.
- ETFs: XLE, ERX, VDE, OIH, ERY, DIG, DUG, IYE, XES, IEZ, PXI, FENY, PXJ, RYE, FXN, DDG
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