Have you been paying attention to shares of YPF Sociedad Anonima (YPF)? Shares have been on the move with the stock up 57.3% over the past month. The stock hit a new 52-week high of $7.37 in the previous session. YPF Sociedad Anonima has gained 91.1% since the start of the year compared to the 33.6% move for the Zacks Oils-Energy sector and the 39.1% return for the Zacks Oil and Gas - Integrated - International industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on August 11, 2022, YPF Sociedad Anonima reported EPS of $2.01 versus consensus estimate of $0.76.
For the current fiscal year, YPF Sociedad Anonima is expected to post earnings of $3.76 per share on $16.7 billion in revenues. This represents a 3660% change in EPS on a 26.13% change in revenues. For the next fiscal year, the company is expected to earn $2.46 per share on $16.49 billion in revenues. This represents a year-over-year change of -34.75% and -1.24%, respectively.
YPF Sociedad Anonima may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
YPF Sociedad Anonima has a Value Score of A. The stock's Growth and Momentum Scores are A and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 1.9X current fiscal year EPS estimates, which is not in-line with the peer industry average of 4.3X. On a trailing cash flow basis, the stock currently trades at 0.9X versus its peer group's average of 3.8X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, YPF Sociedad Anonima currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if YPF Sociedad Anonima passes the test. Thus, it seems as though YPF Sociedad Anonima shares could have potential in the weeks and months to come.
How Does YPF Stack Up to the Competition?
Shares of YPF have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Vista Oil & Gas, S.A.B. de C.V. Sponsored ADR (VIST). VIST has a Zacks Rank of # 1 (Strong Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. Vista Oil & Gas, S.A.B. de C.V. Sponsored ADR beat our consensus estimate by 146.51%, and for the current fiscal year, VIST is expected to post earnings of $2.40 per share on revenue of $1.13 billion.
Shares of Vista Oil & Gas, S.A.B. de C.V. Sponsored ADR have gained 20.9% over the past month, and currently trade at a forward P/E of 4.37X and a P/CF of 3.76X.
The Oil and Gas - Integrated - International industry is in the top 14% of all the industries we have in our universe, so it looks like there are some nice tailwinds for YPF and VIST, even beyond their own solid fundamental situation.
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