Tue, May 5, 3:58 PM
- EOG Resources (EOG -4.8%) plans to increase drilling activity as soon as oil prices stabilize at $65/bbl - probably in Q4 2015 - CEO William Thomas said on today's earnings conference call.
- Thomas anticipates EOG would return to double-digit growth in 2016, and in this year's Q3 may begin finishing wells that it has left half-drilled, with a decision likely in July; "We don’t want to get in a hurry... We don’t want to jump-start completions" and then see the price fall, the CEO said.
- Thomas joins Pioneer Natural Resources (NYSE:PXD), whose CEO Scott Sheffield said last month he was preparing for a return to growth and may begin adding rigs as soon as June.
- EOG also said current well costs are already running at or below 2015 plan levels across all its major plays, and that it is protecting its balance sheet by meeting its cash flow and capex expectations for the year.
Mon, May 4, 12:27 PM
- Pioneer Natural Resources (PXD -2.6%) plunges following negative comments on PXD and other frackers by Greenlight Capital's David Einhorn at the Ira Sohn conference.
- Einhorn calls for shorting PXD, which he dubs "the motherfracker," and says PXD loses $0.20 of present value for every $1 invested, is burning cash and is not growing.
- Of the sector, Einhorn says fracking companies offer an "almost infinite supply of negative return investment opportunities."
- Einhorn says he also is short WLL -2.5%, CXO -1.2%, CLR -1%, EOG -0.7%.
Wed, Mar. 18, 3:43 PM
- Stifel analysts say oil prices could be headed even lower, but that investors should buy high quality E&P companies with strong assets and/or balance sheets before prices bottom.
- Stifel says the current cycle resembles previous patterns where large-cap E&P stocks lead the oil price, which in turn leads the rig count, thus the firm does not expect shares of the strong companies to track an oil price bottom; small-cap energy stocks, however, followed oil prices closely through the last cycle and even lagged the commodity’s recovery.
- The firm is favorably disposed to Anadarko Petroleum (APC +2.4%), Cabot Oil & Gas (COG +1%), EOG Resources (EOG +4.2%), Noble Energy (NBL +5.3%), Rosetta Resources (ROSE +5.3%) and Whiting Petroleum (WLL +8.6%).
Mon, Mar. 16, 10:17 AM
- Street chatter says Statoil (STO -2.8%) may be pursuing EOG Resources (EOG +0.5%) in a merger or acquisition that could exceed $50B.
- Analysts say the deal would make sense for STO, which is seeking to expand its U.S. shale presence; STO also has been mentioned as one of several companies showing interest in Whiting Petroleum (WLL -8%).
- Color Raymond James analyst Andrew Coleman skeptical, saying that a 25% premium over EOG's recent $85 share price - suggesting an offer near $60B - would be needed just to get a returned phone call.
Fri, Feb. 20, 12:44 PM
- EOG Resources (EOG -3.1%) is downgraded to Neutral from Buy with a $102 price target, down from $108, at UBS after EOG cut its 2015 capex by 40% and likely leading to flat Y/Y production likely.
- While UBS believes EOG's ability to rapidly bring on deferred well completions will enable it to return to greater than 10% oil growth in 2016 and 7% company-wide growth, the firm still cuts its 2015 and 2016 cash flow/share estimates by ~15% to a respective $7 and $8.40 following the company's guidance.
- Similarly, Citigroup cut its rating on EOG to Neutral from Buy with a $96 target, and Macquarie lowered shares to Neutral from Outperform also with a $96 target.
Thu, Feb. 19, 9:12 AM
Wed, Feb. 18, 6:46 PM
- EOG Resources (NYSE:EOG) -6.5% AH after Q4 earnings fell sharply from the prior-year quarter and badly missed Wall Street estimates.
- The drop in profits came despite a 26% Y/Y increase in crude and condensate production during Q4 to 307.7M bbl/day.
- EOG also says it will cut its capital budget by ~40% to $4.9B-$5.1B this year, and will delay a “significant” number of well completions as part of a strategy to increase its net present value while capitalizing on future commodity price increases.
- EOG says it plans to complete fewer wells in the Eagle Ford and the Bakken in 2015 than in 2014, but it expects 95 net well completions in the Permian Basin, a 53% increase over last year’s total.
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
Mon, Jan. 12, 3:17 PM
- Goldman Sachs upgrades a few energy stocks even as it cast a pall of gloom over most of the sector today (I, II, III), raising Chesapeake Energy (CHK -3.6%) to Buy from Neutral and Parsley Energy (PE -4.2%) to Neutral from Sell as potential "shale sale" winners.
- Despite PE's relative vulnerability to lower oil prices because of its weak balance sheet and negative projected free cash, Goldman has more confidence that its core Permian Basin position makes it an attractive M&A target.
- Among potential "shale scale" winners - companies that either can build positions in the core and reduce costs of capital - the firm's favorites remain EOG Resources (NYSE:EOG), Range Resources (NYSE:RRC), Pioneer Natural Resources (NYSE:PXD), Cabot Oil & Gas (NYSE:COG) and Concho Resources (NYSE:CXO).
- However, Goldman cuts Bill Barrett (BBG -8.3%) to Sell from Neutral, seeing greater downside risk to its production in a lower oil price environment, and lowers Eclipse Resources (ECR -1.5%) to Neutral from Buy due to a persistently wide funding gap through 2017 coupled with a weak balance sheet.
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. 28, 2014, 7:25 AM
- OPEC yesterday decided to hold production numbers despite the bear market in oil. WTI crude is down about $5 per barrel to $69.
- A premarket look at the top 10 holdings of the XLE: Exxon Mobil (NYSE:XOM) -4.1%, Chevron (NYSE:CVX) -4.1%, Schlumberger (NYSE:SLB) -4.6%, ConocoPhillips (NYSE:COP) -4.4%, EOG Resources (NYSE:EOG) -4.3%, Pioneer Natural Resources (NYSE:PXD) -4.8%, Occidental Petroleum (NYSE:OXY) -4.3%, Haliburton (NYSE:HAL) -4.7%, Anadarko Petroleum (NYSE:APC) -5%, Williams Companies (NYSE:WMB) -1.6%.
- ETFs: ERX, VDE, OIH, XOP, ERY, FCG, DIG, PBW, GASL, DUG, IYE, XES, IEO, QCLN, IEZ, PXE, PXI, FENY, PXJ, PSCE, RYE, PUW, FXN, DDG, HECO
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.
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