Note from Raymond James - Nov 11

[dan_s]

RJs ENERGY SECTOR TEAM is based here in Houston.

Exploration and Production
3Q22 Lookback — Winners, Losers, Themes
John Freeman , CFA (RJA)
How can we best describe 3Q22? Volatile, especially from a commodity standpoint. In fact,
unlike the first half of 2022, 3Q saw crude prices fall nearly 20% Q/Q — a far cry from March’s
$120/bbl “ceiling.” However, despite oil’s southward move, E&P stocks trended higher,
gaining ~5% during 3Q and now sit up ~64% YTD (best performing S&P sector). Looking at
3Q22 results, roughly 65% of our coverage beat on both production and EBITDA and ~60%
beat on adjusted earnings per share. However, cost inflation continues to rear its ugly head
with nearly half reporting higher than expected capex during the quarter. Shifting to a more
positive theme, nearly every company in our coverage currently has a shareholder return
program actively in place, which continues to be applauded by investors.