Advertisement
Singapore markets closed
  • Straits Times Index

    3,224.01
    -27.70 (-0.85%)
     
  • Nikkei

    40,369.44
    +201.37 (+0.50%)
     
  • Hang Seng

    16,541.42
    +148.58 (+0.91%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Bitcoin USD

    70,447.95
    +218.03 (+0.31%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • Dow

    39,807.37
    +47.29 (+0.12%)
     
  • Nasdaq

    16,379.46
    -20.06 (-0.12%)
     
  • Gold

    2,254.80
    +16.40 (+0.73%)
     
  • Crude Oil

    83.11
    -0.06 (-0.07%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • FTSE Bursa Malaysia

    1,540.91
    +10.31 (+0.67%)
     
  • Jakarta Composite Index

    7,288.81
    -21.28 (-0.29%)
     
  • PSE Index

    6,903.53
    +5.36 (+0.08%)
     

Can EOG Resources’ Stock Price Continue Rallying Post-1Q16?

EOG Resources Beats 1Q16 Estimates: How Did Its Stock React?

(Continued from Prior Part)

EOG Resources’ stock price action

EOG Resources (EOG) announced its 1Q16 earnings on May 5, 2016, after the market closed. Better-than-expected earnings led to EOG Resources’ stock price falling by 3.2% the next day.

In the three months leading up to the earnings release, EOG Resources’ stock price rose by ~31%, mainly due to the ~57% bounce in crude oil (USO) (SCO) (DWTI) prices during the same period.

EOG Resources’ stock price trend changes

Falling crude oil (UCO) and natural gas (UGAZ) prices over the last two years have led to a falling trend in the entire upstream sector. EOG is no exception. However, since January 2016, EOG Resources’ stock has been following a new uptrend. It’s clearly developing a pattern of higher highs and higher lows.

ADVERTISEMENT

EOG Resources’ relative performance

In 2016, EOG has been underperforming. Whereas it has risen by ~12%, oil and gas producers Denbury Resources (DNR), Continental Resources (CLR), and WPX Energy (WPX) have risen by ~80%, ~69%, and ~50%, respectively. The Energy Select Sector SPDR ETF (XLE) generally invests at least 95% of its total assets in oil- and gas-related equities from the S&P 500 (SPY).

EOG Resources’ stock price movement after past earnings beats

In the last year, there have been four occasions when EOG beat the earnings expectations: 4Q15, 3Q15, 2Q15, and 1Q15.

EOG reported its 4Q15 earnings after the market closed on February 25, 2016. In 4Q15, excluding one-time items, EOG reported a loss of $0.27 per share, $0.05 better than consensus for a loss of $0.32 per share. Following the earnings release, despite better-than-expected earnings, EOG Resources’ stock price fell by ~5% in three sessions.

For its 3Q15 earnings, excluding the one-time items, EOG reported a profit of $0.02 per share, $0.32 better than the consensus for a loss of $0.30 per share. Following the earnings release, despite the earnings beat, EOG Resources’ stock price fell by ~6% in five sessions.

A similar reaction was observed after the 2Q15 and 1Q15 earnings releases, with EOG Resources’ stock price falling by ~4% in one session and ~11% in 12 sessions, respectively. In 2Q15 and 1Q15, EOG beat the consensus earnings estimates by $0.18 per share and $0.03 per share, respectively.

Browse this series on Market Realist: