Yesterday, 2:39 PM
- Devon Energy (DVN +2.9%) is upgraded to Buy from Hold at Deutsche Bank, which views DVN as particularly well positioned relative to large-cap E&Ps to again grow production into a firming commodity price environment.
- The firm believes DVN's 2014 asset transactions reposition the portfolio to highlight underlying growth potential, high-grade the portfolio towards fewer and key plays, and improve the cost of capital via the EnLink transaction; it also cites DVN's best-in-class hedge position.
- On the other hand, Deutsche Bank lowers Encana (ECA +1.8%) to Hold from Buy, saying ECA is more dependent than peers on the broader commodity price outlook again returning to growth; the firm believes the move to fund the Athlon acquisition with cash on the balance sheet has left ECA with significantly reduced financial flexibility.
Mon, Jan. 12, 12:28 PM
- Wolfe Research’s Paul Sankey prefers EOG Resources (EOG -4%) as the best positioned among well exposed U.S. unconventional energy players that have the balance sheet to survive the current volatility.
- ConocoPhillips (COP -2.8%) has terrific unconventional exposure but enforced capital discipline that effectively forces the company to return cash to shareholders and shrink its size in an orderly manner.
- On Devon Energy (DVN -2.1%): "If EOG is the new Saudi Arabia of global oil, then Devon Energy is its Kuwait."
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
Dec. 22, 2014, 10:45 AM
- Natural gas prices fall 9.5% to near two-year lows at $3.133/mmBtu, in the biggest one-day percentage loss since February and the lowest intraday price since January 2013, on mild weather forecasts and inventory that is above year-ago levels.
- Prices are now down more than 15% in three straight losing sessions and are 30% lower than the six-month high closing price of $4.489/mmBtu it hit just a month ago.
- Weather has been unseasonably warm for December, limiting demand for home heating and allowing relatively low stockpiles to catch up to where they were a year ago and encouraging traders to sell based on the belief that supply is relatively healthy.
- Gas producers are among the biggest early decliners: XOM -1.1%, CHK -7.3%, APC -2.6%, SWN -6%, DVN -2.2%, COP -2.3%, BP -1.5%, COG -4%, BHP -1.9%, CVX -1.3%, ECA -5.1%, EQT -4.3%, RDS.A -1.7%, UPL -12%, WPX -6.9%, EOG -1%, OXY -1.1%, RRC -6.1%, APA -2.3%, AR -3.2%, CNX -3%, QEP -4.8%, LINE -4.9%, NBL -1.6%, SM -2.6%, XEC -4.2%, PXD -2.9%, NFX -5.1%.
- ETFs: UNG, DGAZ, UGAZ, BOIL, GAZ, FCG, GASL, KOLD, UNL, NAGS, DCNG
Dec. 3, 2014, 11:32 AM
- The energy sector (XLE +1.5%) continues its momentum from yesterday, leading the way again as the best performing sector in early trading with crude oil rising 1.2% so far today and reports that U.S. well permits fell 40% last month.
- Top performers include Clayton Williams (CWEI +7.7%), Transocean Partners (RIGP +10.6%), Gaslog (GLOG +13.8%) and Energy XXI (EXXI +15.7%).
- Other leading energy names are showing stronger recoveries as they clear last Friday's bearish gap zone: XOM +0.2%, CVX +0.4%, COP +2.5%, OXY +2.5%, DVN +2.9%, EOG +2.5%, HES +2.2%, MUR +1.5%, NBL +2.3%, PXD +4.2%, SU +3%, CNQ +1.9%.
- Some analysts warn that the worst may not be over, however, as much of the advance is being driven by investors repurchasing ETFs they used to make short bets; investors also could opt to sell oil shares at a loss in coming weeks to reduce tax burdens.
Dec. 2, 2014, 2:48 PM
- Energy stocks (XLE +1.4%) are posting the day's largest gains among S&P sectors, rebounding from recent losses even as Nymex crude oil fell another $2.05 to $66.97/bbl.
- Refiners Marathon Petroleum (MPC +4%) and Valero (VLO +4.1%) and pipeline operator Williams Cos. (WMB +1.5%) are among the top gainers, while losers include most oil services companies such as Halliburton (HAL -2.2%) and rig operator Transocean (RIG -3.7%).
- Anadarko Petroleum (APC +1.6%), Cimarex Energy (XEC +1%), Devon Energy (DVN +0.7%), EOG Resources (EOG +3.8%) and Marathon Oil (MRO +3.5%) were selected top “safe haven” picks for analysts at Tudor Pickering Holt, which said they are “liquid names with high-quality assets and healthy balance sheets."
Nov. 5, 2014, 2:37 PM
- After taking a beating in the previous two sessions in the wake of plunging oil prices, energy stocks are attracting buyers today and accounting for nearly a third of the session's total gains on the S&P 500.
- The advance has been underpinned by strong showings by Devon Energy (DVN +9.3%) and EOG Resources (EOG +5.9%), which posted better than expected earnings results and higher production growth guidance.
- DVN's Q3 revenues nearly doubled Y/Y to $5.35B from $2.71B, cash margins rose 20% as costs per barrel fell 3% Q/Q, and it raised the midpoint of Q4 production guidance by 3% to 617 boe/day without any increase in capital spending.
- At EOG, Q3 production jumped 29% and is further boosting its growth target for oil even in the face of a market slump, and says results from wells drilled in the Permian Basin confirm that almost two thirds of its 140K-acre land position there is promising and will provide a high rate of return.
Oct. 9, 2014, 3:25 PM
- Crushed by relentless anxiety about oversupply and weakening global demand, Nymex crude oil futures closed down $1.54 at $85.76/bbl, their lowest close since Dec. 2012, while Brent crude fell below $90/bbl for the first time in more than two years.
- Including today's losses, WTI crude is down 6.2% since the start of the month and Brent has surrendered ~5%.
- In the face of surging output, a move in WTI below its 10-year average at $82 is not out of the realm of possibility, Brown Brothers Harriman says, adding that "a break of $73/barrel could send WTI toward $64, which corresponds with the 2010 low."
- Among big oil names so far today: APC -6.3%, LINE -4.6%, EPD -3.8%, DVN -3.8%, MRO -3.6%, HES -3.8%, KMI -3.7%, TOT -3.5%, STO -3.3%, RDS.A -3.1%, OXY -3%, KMP -3%, XOM -2.6%, COP -2.6%, MUR -2.6%, CVX -2.5%, BP -2.4%.
- ETFs: USO, XLE, OIL, UCO, ERX, VDE, OIH, SCO, ERY, XOP, DIG, BNO, DTO, DBO, DUG, IYE, XES, IEO, CRUD, IEZ, PXE, USL, UWTI, PXJ, FENY, DNO, DWTI, RYE, FXN, SZO, OLO, DDG, OLEM, TWTI
Jun. 30, 2014, 12:17 PM
- Devon Energy (DVN +0.2%) received a better than expected price in its $2.3B deal to sell non-essential U.S. assets to Linn Energy (LINE +1.6%), Wells Fargo analyst David Tameron says.
- DVN brought in well above the high end of expectations, which the firm presumes was $1.2B-$1.4B; the divestment helps further delever DVN’s balance sheet, and management expects to reduce net debt by ~$4B by year-end.
- LNCO +2.6%.
May. 20, 2014, 11:22 AM
- Devon Energy (DVN +2.2%) moves within a dollar of its 52-week high after Barclays upgrades shares to Overweight from Equal Weight to reflect the impact of its oil growth strategy on valuation and stock performance.
- Barclays says DVN's balance sheet adjusted growth rate correlation with share prices as “very good proxies for returns on new capital."
- Also, Oppenheimer raises its DVN price target to $85 from $75; following a recent meeting with COO David Hager, the firm is upbeat on DVN's recent transactions and expects it to generate $600M of free cash flow next year, enabling it to reduce its debt (Briefing.com).
May. 7, 2014, 8:58 AM
- Devon Energy (DVN) +1.6% premarket after reporting a Q1 profit compared with a year-ago loss when it wrote down the value of some natural gas assets.
- Q1 oil and gas output totaled 691K boe/day, up 0.6% Y/Y; excluding production associated with divestiture properties, top-line production from Devon's retained, go-forward asset base rose 7% Y/Y to 563K boe/day.
- Led by the Permian Basin and Eagle Ford, DVN's most significant growth came from retained U.S. operations, where oil production jumped 56% Y/Y.
- Average realized prices, before hedging impacts, jumped 29% for oil and 51% for natural gas.
Mar. 7, 2014, 2:57 PM| 3 Comments
Mar. 5, 2014, 10:56 AM
- Crosstex Energy LP (XTEX -1.7%) is downgraded to Hold from Buy with a $33 target price at Wunderlich, as it believes near-term yield compression from synergies and growth development may be limited.
- For investors with higher risk tolerance, the firm prefers to play the story through general partner Crosstex Energy Inc. (XTXI -1.2%), which offers sector-leading dividend growth estimated at 53% in 2014 and 43% in 2015.
- The legacy businesses remain challenged, which could be a risk to 2014 guidance and 2015-16 double-digit distribution growth, the firm adds.
Jan. 24, 2014, 2:45 PM
- As the U.S. freezes and stocks plunge, benchmark U.S. natural gas futures topped $5/mmBtu for the first time since Aug. 2010 on expectations that continued cold weather would keep demand high for the heating fuel.
- Natl gas has moved well into overbought territory during the last few days as consumers have pumped up their thermostats, and the spike may last a while longer given that the cold snap is set to continue all of next week.
- Despite the run-up in prices for Jan. and Feb., longer-dated prices for the spring and summer remain below $4.50/mmBtu, providing little incentive for the likes of Chesapeake (CHK -0.1%), Devon (DVN -0.8%) and EOG (EOG -2%) to switch from oil to gas drilling.
- The shift to backwardation is a big boost to United States Natural Gas Fund (UNG +8.2%) and even bigger to the leveraged VelocityShares 3X Long Natural Gas ETN (UGAZ +24.4%).
- Other ETFs: GAZ, BOIL, DGAZ, UNL, KOLD, NAGS, DCNG.
Dec. 23, 2013, 5:35 PM
Nov. 20, 2013, 9:16 AM
- Devon Energy (DVN) confirms it has reached a definitive agreement to acquire GeoSouthern Energy's Eagle Ford assets for $6B.
- The acquired assets include current production of 53K boe/day and 82K net acres with at least 1,200 undrilled locations.
- Estimated recoverable resource is 400M boe, mostly proved reserves, with the acreage position located in the best part of the play, as evidenced by the highest average initial production rates in the entire play and average estimated ultimate recoveries in DeWitt County exceeding 800K boe/well.
- DVN says the acquisition will be funded with a combination of cash on hand and borrowings.
- Shares +4.5% premarket after rising nearly 5% yesterday when WSJ first broke news of the deal.
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