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Cabot Oil (COG) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Cabot Oil (COG) closed at $27.04 in the latest trading session, marking a -1.42% move from the prior day. This move lagged the S&P 500's daily loss of 0.23%. At the same time, the Dow lost 0.01%, and the tech-heavy Nasdaq lost 0.05%.

Prior to today's trading, shares of the independent oil and gas company had gained 5.66% over the past month. This has outpaced the Oils-Energy sector's gain of 0.23% and the S&P 500's gain of 3.16% in that time.

Wall Street will be looking for positivity from COG as it approaches its next earnings report date. This is expected to be April 26, 2019. On that day, COG is projected to report earnings of $0.63 per share, which would represent year-over-year growth of 125%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $654.15 million, up 38.23% from the year-ago period.

COG's full-year Zacks Consensus Estimates are calling for earnings of $1.97 per share and revenue of $2.38 billion. These results would represent year-over-year changes of +65.55% and +8.97%, respectively.

Investors should also note any recent changes to analyst estimates for COG. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 5.99% higher within the past month. COG currently has a Zacks Rank of #1 (Strong Buy).

Investors should also note COG's current valuation metrics, including its Forward P/E ratio of 13.96. For comparison, its industry has an average Forward P/E of 15.72, which means COG is trading at a discount to the group.

Meanwhile, COG's PEG ratio is currently 0.39. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Oil and Gas - Exploration and Production - United States industry currently had an average PEG ratio of 1 as of yesterday's close.

The Oil and Gas - Exploration and Production - United States industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 159, which puts it in the bottom 38% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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