Yahoo Finance Is Noble Corporation’s Share Price Beginning to Rise?
Can Noble Corporation Shrug Off the Energy Crisis?
Noble Corporation versus peers and industry
Noble Corporation (NE) is a leading global offshore drilling contractor. Its share price, which trended down for a large part of 2015, is beginning to look up in the stock market. On March 16, 2016, NE was trading at $11.27. This was a fall of 18% from its price a year ago.
The Market Vectors Oil Services ETF (OIH), an ETF tracking an index of 25 oilfield services (or OFS) companies, has fallen 16% in the past year. RPC (RES), NE’s smaller-market-cap peer, has risen 21% during the same period. NE makes up 2.3% of OIH.
West Texas Intermediate (or WTI) crude oil’s price has fallen 10% compared to a year ago. The OFS industry has been negatively affected by the energy price crash since June 2014.
What does Noble Corporation’s share price movement tell us?
Noble Corporation’s share price has been trending downward since late April 2015. Unlike many of its OFS peers, NE’s quarterly revenues and earnings did not fall sharply in the four quarters leading up to 4Q15, and its cash flow from operations remained strong. Since the third week of January 2016, when NE’s price reached its one-year low, it has recovered 63%.
Noble Corporation’s moving averages
On March 16, Noble Corporation’s share price was at a 29% premium to its 50-day moving average. It is trading 6% below its 200-day moving average.
Moving averages exhibit a smoother trend following a stock’s price movements. A 50-day moving average is a short-term moving average, while a 200-day moving average shows a long-term trend. NE’s short-term moving average has stayed below its long-term moving average throughout the past year.
NE’s share price crossed above its short-term moving average in March 2016 and is staying close to its long-term moving average. This indicates that NE’s share price is gathering some momentum.
In this series, we’ll look at Noble Corporation’s top line and bottom line growth, recent contracts, balance sheet, free cash flow, dividend, and valuation multiples. We’ll start with its management’s comments in the next part.
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