|Bid||0.00 x 900|
|Ask||81.42 x 900|
|Day's Range||75.39 - 77.65|
|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 (1.52%)|
|1y Target Est||101.56|
Today we'll take a closer look at EOG Resources, Inc. (NYSE:EOG) from a dividend investor's perspective. Owning a...
Higher oil prices will encourage explorers to produce more of the commodity, while the oilfield service firms are likely to get more contracts from upstream energy players.
Chesapeake Energy (NYSE:CHK) stock has become intriguing again. Investors sold CHK off when management raised "going concern" issues. However, recent debt financing deals have bought it more time.Source: Casimiro PT / Shutterstock.com Such a deal may make a recovery in CHK stock possible. However, recent successes in the oil patch have supplied the market with too much oil and gas. Given this reduced pricing, I would not recommend a speculative play in Chesapeake Energy stock.In the last earnings report, the company called into question its future as "going concern." At that point, I sold my own speculative position, and it has fallen since that time.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThe problem for CHK stock is that the oil and gas boom has become a victim of its own success. The United States now produces so much oil and gas that these assets continue to lose value. * These 7 S&P 500 Stocks Will Deliver a Repeat Performance in the Next Decade Chevron (NYSE:CVX) just announced that they would take between $10 billion and $11 billion in write-downs in the fourth quarter as a result. One has to assume that ExxonMobil (NYSE:XOM), EOG Resources (NYSE:EOG), ConocoPhillips (NYSE:COP), and other oil majors could follow suit.The company holds $9.34 billion in long-term debt, a crushing burden for a company with only a $1.5 billion market cap. Falling oil and gas prices and asset write-downs have dimmed the prospects of reducing that debt. Moreover, the move to buy Wildhorse Resources to sell more oil may have backfired as oil prices have also failed to gain traction.That said, the company has again made CHK stock alluring with the latest debt deals. One deal comes in the form of a $1.5 billion, 4.5-year loan facility that retired an existing revolving credit facility worth about $900 million.Under a separate debt agreement, it will issue an additional $1.5 billion in bonds. These will come due in 2025 and carry an 11.5% coupon. They will also finance the retirement of some debts at 62 cents and 70 cents on the dollar.While this appears strange, some of the bonds traded below 50 cents on the dollar, as Dana Blankenhorn pointed out. Hence, these bondholders still benefit. Moreover, these deals buy Chesapeake more time to clean up its balance sheet. All of this has helped take the CHK stock price back up to around 75 cents per share. Chesapeake Energy Stock Has Become a GambleSome stock market detractors refer to investing in equities as "gambling." In most cases, I object to that view. However, that viewpoint may describe CHK stock accurately. I say this because Josh Enomoto's football analogy describes Chesapeake's situation accurately. Not only must they execute a fourth-and-long play flawlessly, factors which the company does not control must also go right.To be sure, a lot could go wrong for Chesapeake Energy stock. The previously-mentioned asset write-downs do not bode well for the industry. Moreover, the U.S.-China trade dispute makes prospects for selling in China tenuous. The falling cost of renewables could also further dampen the demand for fossil fuels. That push for renewables could accelerate further if a Democrat wins the White House in 2020.Investors who feel they can prevail amid the above conditions may choose to buy. A 100% loss of one's investment is a real possibility. However, if Chesapeake's management has run the right play, and some factors that they do not control go right, the returns on CHK stock could run several multiples above 100%. Still, with the risks involved, this is not a move that I encourage. Concluding Thoughts on Chesapeake Energy StockCHK stock has become a gamble with increasingly longer odds. Falling energy prices and statements from management have cast doubts about the future of Chesapeake.The company inspired some optimism with new debt financing deals. However, conditions continue to worsen as energy prices fail to gain traction. Moreover, geopolitical uncertainties and the increased viability of so-called "clean" energy solutions could add to the revenue pressure.If the company manages to clean up its balance sheet, CHK stock will rise exponentially. However, failure could lead to bankruptcy, and external market conditions continue to bode poorly for the company. Given the worsening market environment, I would not recommend a speculative position here.As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 10 Worst Dividend Stocks of the Decade * 7 Game-Changing Tech Stocks to Buy Now * 5 Chinese Stocks to Buy for the Big 2020 Rebound The post Even After Its Latest Moves, Chesapeake Energy Stock Is Still Too Risky appeared first on InvestorPlace.
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
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.