|Bid||75.63 x 900|
|Ask||75.64 x 900|
|Day's Range||75.39 - 77.64|
|52 Week Range||64.33 - 107.89|
|Beta (5Y Monthly)||1.38|
|PE Ratio (TTM)||14.66|
|Earnings Date||Feb 24, 2020 - Feb 28, 2020|
|Forward Dividend & Yield||1.15 (1.54%)|
|1y Target Est||101.56|
California's largest utility PG&E shut off power to millions of people over the course of October and November to avoid starting more wildfires that previously devastated the state. Meanwhile, PG&E said enforcing intermittent power outages could continue for another 10 years as it works to upgrade its system. Federal Energy Regulatory Commission, Chairman Neil Chatterjee, joins the On the Move to discuss California's energy crisis and how it plans to solve it.
The Board of Directors of EOG Resources, Inc. (EOG) has declared a dividend of $0.2875 per share on EOG's Common Stock, payable January 31, 2020, to stockholders of record as of January 17, 2020. The indicated annual rate is $1.15.
(Bloomberg Opinion) -- Even now, the figure of $1.71 trillion is surely dramatic enough to fire the odd synapse in our jaded, zero-rate-numbed hive mind. That is the value at which Saudi Aramco will enter the stock market this week.Yet it still isn’t quite enough for some folks — Saudi Arabian royalty specifically. Crown Prince Mohammed bin Salman famously put a value of $2 trillion on Saudi Arabian Oil Co. when he first announced plans to float it, almost four years ago. Speaking on Friday at the end of a contentious OPEC+ gathering, Saudi Energy Minister Prince Abdulaziz bin Salman (the Crown Prince’s half-brother) voiced displeasure at the media’s coverage of the IPO. He went on to say:… We decided to lower the valuation that we were seeking. But on the 11th [of December] the shares will be trading. And a few months from now, I’ll remind — I wouldn’t call them by name — but I think they will probably like to not have written those pieces that they have written. Because we will get Aramco and it will be higher than the two trillion, and I can bet that this will happen.Even the sell side usually gives it 12 months on a price target, but I have to concede Saudi officials have taken to the oil sector’s investor relations style with aplomb. High spirits are understandable, though; how often do you get to float the biggest company ever (not to mention one that also provides more than half your country’s public budget)? Don’t forget the political benefits, either: At this point, $2 trillion feels less like an actual dollar amount and more like a patriotic rallying cry.The energy minister may well soon be crowing to all who put Aramco’s value somewhere below $2 trillion (myself included) that we were wrong. Not that it would really matter. Having been scaled way back from the global offering envisaged originally to a minimal domestic listing, Aramco’s IPO puts the “market” in market value. Average daily trading volume for the entire Tadawul All Share Index over the past year is actually slightly less than that of just one oil major, Exxon Mobil Corp, according to data compiled by Bloomberg.Aramco’s imminent inclusion in emerging-market indices will undoubtedly suck some passive money toward it (a potential headwind for other emerging-market oil champions as well as fellow Tadawul constituents). However, while Aramco’s market cap is far bigger than that of the big five Western majors combined, its implied free float of about $28 billion is less than that of just one U.S. fracker, EOG Resources Inc. Speaking of which, the context of Prince Abdulaziz’s price target is interesting. He had just announced that Saudi Arabia would voluntarily keep another 400,000 barrels a day off the market beyond its new (reduced) supply target. It was this that pulled the OPEC+ meeting back from the brink of failure and halted a sell-off in oil on Friday.Saudi Arabia’s de facto crude-oil production target is now just over 9.74 million barrels a day, which is below its average for the year so far. Based on my math, and assuming $65 Brent, that would net Aramco free cash flow of about $70 billion in 2020, $5 billion shy of its minimum dividend payment(3). Of course, the new batch of minority shareholders wouldn’t suffer; the government has guaranteed their payout. But it re-emphasizes just how pricey Aramco is: A valuation of $2 trillion based on that $70 billion figure would imply a free-cash-flow yield of just 3.5%. That is not only far below what most of Aramco’s peers offer, it’s less than the yield on Aramco’s 30-year bonds. Taking this a step further, when I valued Aramco at just under $1.5 trillion, I assumed (among many other things) average crude oil production of 11 million barrels a day, $65 Brent and a dividend yield of 5.85%. But say production averages something less than that. At 10.5 million barrels a day, my math implies Aramco would need long-term oil prices north of $100 a barrel to justify a $2 trillion valuation. As it stands, the IPO implies a dividend yield of just under 4.4%. At 10.5 million barrels a day, even at that lower yield, a $2 trillion valuation needs $69 a barrel; at 10 million a day, it requires $74.Needless to say, the higher the oil price, the more breathing room for U.S. frackers (among other competitors); Prince Abdulaziz acknowledged as much on Friday. It would also have the opposite effect on demand. All of which matters, especially when an oil company has 60-odd years of reserves to monetize. Hence, even if markedly higher oil prices juiced Aramco’s near-term cash flows, they could also erode its long-term value.So when it comes to the dream of $2 trillion, focus less on oil prices going up and more on keeping those yields down. It’s the mismatch between the cost of capital on offer from global fund managers and the more generous terms provided by local and regional investors that explains Aramco’s valuation. On that basis, beyond scratching some emotional or political itch, it’s tough to say what hitting the magic number would really mean.(1) This assumes the target holds through 2020, although OPEC+ will meet to assess things in March.To contact the author of this story: Liam Denning at firstname.lastname@example.orgTo contact the editor responsible for this story: Mark Gongloff at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
EOG Resources (EOG) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.
The U.S. shale patch is showing serious signs of financial distress, but a few companies continue to drill profitably for oil & gas in America’s most prolific shale basins
(Bloomberg) -- At EOG Resources Inc.’s Francisco lease in the heart of the Eagle Ford Shale in South Texas, a half dozen cows laze in the shade of a tree next to black oil-storage tanks. A small flare burns atop a steel pylon, like a memorial to the boom days gone by.There are six wells on the parcel of land -- three drilled in 2013 and three from 2016 -- and together they churn out just 130 barrels of crude daily, worth about $7,150 at current prices, according to data from ShaleProfile Analytics. Output is down more than 95% from peak levels, the data show.Yet wells like these may be a harbinger of the U.S. shale industry’s future if investors are successful in forcing independent explorers to prize profits over production. In the wake of the oil price crash that began in 2014, new drilling in the Eagle Ford dwindled as management teams cut budgets, and output in the region is now down about 20% from pre-crash levels.That austerity finally began to pay off this year as the Eagle Ford as a whole generated free cash flow for the first time, according to IHS Markit.It’s a grand bargain that the Eagle Ford’s bigger Texas cousin -- the Permian Basin -- is wrestling with: sacrificing growth for profits.At current oil prices, “what you cannot do is harvest cash and grow,” said Raoul LeBlanc, a Houston-based analyst at IHS. “There’s an inflection point coming here because production growth is going to slow down massively.”The implications for U.S. oil production are vast. Shale wells are gushers for the first three months but after that, output plummets so that by the end of the first year it’s down about 60%. That’s 10 times the decline rate of conventional wells.Running To Stand StillAs a result, America’s record crude output relies heavily on new wells. About two-thirds of U.S. shale oil comes from wells drilled within the past 18 months, according to ShaleProfile’s data.As the Eagle Ford shows, once new drilling slows, production quickly follows. Explorers in the South Texas field reduced drilling sharply in 2016, when oil cratered to less than $30 a barrel, and overall production has never fully recovered. The Eagle Ford now produces 1.37 million barrels a day, about 20% below its peak four years ago.Of the basin’s 17,511 shale oil wells that came online before 2018, 60% are pumping less than 25 barrels a day. Most new drilling just fills the gaps left by rapidly declining older wells. EOG said its Francisco wells, on average, paid back their costs in less than a year and remain profitable today.Chickens, PumpjacksOn an autumn drive through the lush pasture lands of Gonzalez County east of San Antonio, tractors share gravel roads with oilfield trucks doing routine maintenance. Chicken farms and cattle ranches are interspersed with pumpjacks and oil-storage tanks. There are none of the traffic jams, new car dealerships and storefront bail bondsmen of the Permian Basin 400 miles (645 kilometers) to the west.Although the Eagle Ford became cash-flow positive earlier this year, the spoils haven’t been equally shared. The bulk of the positive earnings came from three companies: ConocoPhillips, Devon Energy Corp. and EOG. Some, such as Sanchez Energy Corp., filed for bankruptcy in August while Pioneer Natural Resources Co. and Equinor ASA sold assets.READ: Texas Scoffs at Paris Oil Predictions as Shale Patch Feels PainNext year looks like a potential turning point for the industry as shale specialists focus on harvesting cash and restraining the itch to expand drilling at all costs. The resulting slowdown in output growth, in turn, may mean an end of the U.S. domination of global crude-supply growth.“Generating free cash is easy: stop spending on new wells,” LeBlanc said. “The catch is that production will immediately move into steep decline in many cases.”Exxon, ChevronTo be sure, the top American drillers -- Exxon Mobil Corp. and Chevron Corp. -- aren’t under the same investor pressure to curtail spending, and have mapped out ambitious growth targets from shale holdings in the Permian and elsewhere. At the same time, some smaller operators have no choice but to continue drilling to generate cash for debt payments.EOG also expects to increase Eagle Ford production this year. “EOG’s level of production growth is an output driven by reinvesting for returns while also generating free cash flow,” the Houston-based company said in a statement.(Updates with EOG comment in 10th paragraph.)To contact the reporter on this story: Kevin Crowley in Houston at firstname.lastname@example.orgTo contact the editors responsible for this story: Simon Casey at email@example.com, Joe Carroll, Carlos CaminadaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The Zacks Analyst Blog Highlights: Pioneer Natural Resources, Diamondback Energy, Callon Petroleum, EOG Resources and ConocoPhillips
Despite the recent signs of moderation in American oil production growth, the country is poised to become energy independent by next year.
We at Insider Monkey have gone over 752 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds' and investors' portfolio positions as of September 30th. In this article, we look at what those funds think of EOG Resources Inc (NYSE:EOG) based on that […]
The South Texas Drilling Permit Roundup is a weekly review of new drilling permit applications filed with the Railroad Commission of Texas for a 67-county area of South Texas.
When weighing which oil stocks to buy, consider which ones are the leaders in U.S. shale or are already big players making moves in top plays like the Permian.
The energy sector consists of stocks related to the production and supply of energy around the world. The sector includes upstream firms that are involved in the exploration and production of oil or gas reserves, such as EOG Resources Inc. (EOG). Also in the sector are downstream companies that refine and process oil and gas products for delivery to consumers, including HollyFrontier Corp. (HFC).
EOG Resources, Inc. (NYSE:EOG) shareholders should be happy to see the share price up 11% in the last month. But in...
Missed the slew of shale oil earnings? Here's a quick run-through of how some of the bigwigs fared in their third-quarter earnings reports.
While the commodity pricing scenario continues to be challenging, both EOG Resources (EOG) and Occidental Petroleum (OXY) benefited from higher year-over-year production.
Trade war optimism sent oil prices up at the start of the week but, with traders now growing skeptical of any progress in the talks between China and the U.S., oil prices are entering a familiar cycle
The energy sector consists of stocks related to the production and supply of energy around the world. Among energy sector companies are upstream firms—those involved in the exploration and production of oil or gas reserves—like EOG Resources (EOG). Also in the sector are downstream companies that refine and process oil and gas products for delivery to consumers, including HollyFrontier (HFC).
(Bloomberg Opinion) -- EOG Resources Inc. delivered something of an antidote to the venom that coursed through the fracker stocks Wednesday. Another darling of the sector, Diamondback Energy Inc., had sickened investors with a shock miss on production, adding to the growing chorus of voices announcing shale’s imminent demise (while oil prices also fell on trade fears). EOG’s combination of soundly beating production guidance with lower-than-expected spending, released Wednesday evening, was like a calming tumbler of whiskey at the end of a grueling day.Or grueling earnings season; EOG’s call marks the end of quarterly numbers for the biggest exploration and production numbers, and investors will mostly be glad to see the back of them. Chesapeake Energy Corp.’s slump below a buck a share was an extreme example — albeit with a certain fin-de-siècle frisson — but the problems of high leverage and too much spending remain endemic across the sector.EOG stands out for bucking that trend. And though it seems churlish to say, it could quite easily stand out even more.EOG has cracked the formula for pleasing a cohort of energy investors who are increasingly ornery (if they even bother to show up, that is): steady growth twinned with free cash flow and low leverage. Higher productivity, generated by in-house improvements rather than just squeezing suppliers, according to the company, means EOG has dropped its average rig-count target from the year from 40 to 36. Net debt to Ebitda has dropped from an already conservative 0.7 times a year ago to just 0.5 times at the end of the third quarter. Little wonder EOG’s benchmark 2023 bonds have rallied by more than 5% this year. That stands in marked contrast to the stock, which, even after Thursday morning’s 5% bump, is down 13%. Weak oil prices and broader revulsion to any company producing the stuff explains some of that, of course. But EOG has lagged a falling sector as its earnings multiple has dropped a couple of points.With others suffering — Diamondback’s multiple has slumped to less than 9 times — investors may be worried about EOG making a big acquisition, which hasn’t exactly been the path to prosperity in the sector. EOG went out of its way on Thursday morning to dispel such notions. Another risk that has surfaced of late, that a Democratic president might restrict fracking on federal lands, also prompted EOG to add a couple of slides to its presentation. Given the number of moving parts, not least exactly how much a president antipathetic to fracking could actually do, this seems a minimal risk for now.One way to address it all at a stroke would be to bump up EOG’s dividend substantially. The company has been raising payouts at a fair clip already, up more than 70% over the past two years. But the actual amounts are pretty small, with EOG paying out just $166 million in the third quarter, equivalent to just 8% of cash from operations and about 29% of free cash flow after capital expenditure. On a trailing four-quarter basis, the proportions are even lower.EOG’s stock now yields about 1.5%, and the company targets 2%, which would take it slightly above the S&P 500. That’s a significant level to beat given the E&P sector’s history of benchmarking by navel gazing, judging its own performance against the weaknesses of peers.Getting there wouldn’t actually cost that much: an extra $200 million or so, annualized. That would take payouts to 10% of cash flow from operations and 42% of free cash flow. EOG of course doesn’t want to set itself up for a potential cut down the road if oil prices drop, perhaps as early as next year. But low leverage and the wide cushion of free cash flow above and beyond dividend payments provide a significant buffer already.Moreover, EOG spent much of Thursday morning, as it does every quarter, playing up the low breakeven prices of its drilling inventory, providing resilience to the inevitable swings in commodity prices. A relatively small increase to the dividend bill would go a long way in backing that up, and closing the valuation gap.To contact the author of this story: Liam Denning at firstname.lastname@example.orgTo contact the editor responsible for this story: Mark Gongloff at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Shares of shale producer EOG Resources Inc. rose as much as 5.6% on Thursday after the company topped its third-quarter oil production targets and pared its 2019 capital spending plan. Investors have been pressuring oil and gas companies to rein in spending and boost shareholder returns instead of embarking on costly growth projects, especially with oil prices hovering in the mid-$50s-a-barrel range. U.S. oil futures were trading at about $57.50 on Thursday.