Upstream Company are oversold
Posted: Tue Aug 22, 2017 11:51 am
Barron's: There’s Still Value In E&P Companies Despite Post-Earnings Selloffs
Stephens' Will Green and his team take a look back at the second quarter for exploration and production companies, writing that even though a lot of negative sentiment surrounds the sector, there's still value to be found.
Green writes that although a number of positive company-specific developments happened in the quarter, most of investors' focus was dominated by Permian gas-oil ratio concerns. He believes that those worries are overblown, but he does write that the scrutiny could lead to near-term headwinds for Permian Basin-related stocks.
Going into the quarter, he writes that he expected a "softening out" of language from many E&P companies, but with WTI prices moving back toward $50 a barrel, 2017, and even 2018 plans, remain largely intact. He writes that with oil volatility expected to persist, it was a smart move for companies to lock in hedges in the $50/barrel range, which should shield capital plans and may help them gain market share.
After attending EnerCom, Will Green's top picks include PDCE and RRC
More detail from the note: http://www.barrons.com/articles/theres- ... yptr=yahoo
Stephens' Will Green and his team take a look back at the second quarter for exploration and production companies, writing that even though a lot of negative sentiment surrounds the sector, there's still value to be found.
Green writes that although a number of positive company-specific developments happened in the quarter, most of investors' focus was dominated by Permian gas-oil ratio concerns. He believes that those worries are overblown, but he does write that the scrutiny could lead to near-term headwinds for Permian Basin-related stocks.
Going into the quarter, he writes that he expected a "softening out" of language from many E&P companies, but with WTI prices moving back toward $50 a barrel, 2017, and even 2018 plans, remain largely intact. He writes that with oil volatility expected to persist, it was a smart move for companies to lock in hedges in the $50/barrel range, which should shield capital plans and may help them gain market share.
After attending EnerCom, Will Green's top picks include PDCE and RRC
More detail from the note: http://www.barrons.com/articles/theres- ... yptr=yahoo