Energy

Despite Oil Back Above $68 per Barrel, 10 Major Oil and Gas Stocks Still Negative So Far in 2018

Jon C. Ogg

Published: April 18, 2018 4:19 pm

Last Updated: January 12, 2020 12:48 am

With West Texas Intermediate crude oil putting in another strong day, a gain of more than $2 per barrel has put the price of benchmark crude back above $68.50 per barrel. This marked the highest level going back to when oil prices were falling rapidly in the second half of 2014.

With oil coming back in vogue, most investors might just automatically assume that the large oil stocks are all surging. Most were up on Wednesday with the commodity price, but it is surprising to see just how many companies in the S&P 500 tied to energy and oil and gas are still negative on a total return basis (share price and dividends) year to date in 2018.

U.S. crude oil production already had been challenging 10 million barrels per day by the end of 2017. Now that production has continued to surge past the peak production of late in 1970. After rising more than 400,000 barrels per day by the end of March, a recent updated forecast from Criterion Research expects that oil production will keep growing to perhaps more than 11.1 million barrels per day equivalent toward the end of 2018.

Investors need to understand that many oil producers already have locked in prices now for the months ahead (or longer). That would imply that domestic oil production could keep rising even if the price of oil in the financial markets were to soften further.

It turns out that the two largest domestic oil and gas companies are also down or will be down for 2018, if there is any additional sell-off after Wednesday.

Chevron Corp. (NYSE: CVX) was last seen trading up 2.3% at $124.30 on Wednesday, but that is barely up from the adjusted closing price of $123.96 from December 29. When the market and energy stocks were doing well, the stock went as high as $133.00 before bad earnings dragged it down. Chevron shares have a 52-week trading range of $102.55 to $133.88 and a consensus analyst target price of $135.88. Chevron has a 3.7% dividend yield and a $238 billion market cap.

Exxon Mobil Corp. (NYSE: XOM) was last seen trading up 1.5% at $79.55 on Wednesday, but that was still down about 4% so far in 2018, and the shares had even tried to challenge the $90 mark before peaking in late January and the first day of February. Exxon has a 52-week range of $72.16 to $89.30 and a consensus target price of $85.98. It also has a 3.9% dividend yield and a $337 billion market cap.

If you count Exxon Mobil in the red, 24/7 Wall St. used a Finviz screen identifying nine other companies tied to oil and gas that are S&P 500 members and with shares still negative for 2018. We have identified the drop prior to Wednesday’s move, identified their 52-week range and consensus price target from Thomson Reuters, and included their market cap and dividend yields so investors can see a larger picture.

These year-to-date losers have been listed in order of the worst performing shares first.

Cimarex Energy Co. (NYSE: XEC) was last trading 4% higher over the past month, but its shares were still down 21% so far in 2018. Cimarex was up 5% on Wednesday afternoon at $101.44, in a 52-week range of $87.98 to $130.16 and with a consensus target price of $135.94. It has a 0.7% dividend yield and nearly a $10 billion market cap.

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Southwestern Energy Co. (NYSE: SWN) is still barely up over the past week and month, but its shares were last seen down over 19% so far in 2018. If that sounds bad, Southwestern Energy shares are still down about 40% from a year ago. Southwestern was up 2% on Wednesday afternoon at $4.58, in a 52-week range of $3.42 to $8.25 and with a consensus analyst target of $6.13. It has a $2.7 billion market cap.

Devon Energy Corp. (NYSE: DVN) was not up much in the past week, but the gain of 5% over the past month pales in comparison to the 18% drop that shareholders have endured so far in 2018. Devon Energy was up nearly 8% on Wednesday afternoon at $36.29. The 52-week range is $28.79 to $45.16, and the consensus target price is $46.15. The company has a 1.0% dividend yield and a $19 billion market cap.

Range Resource Corp. (NYSE: RRC) has been down on almost all metrics, except for Wednesday’s 3.4% gain to $14.64. Prior to this day’s gain, shares were down over 4% in the past week, down over 6% in the past month and down 17% so far in 2018. If that sounds bad, it was down about 50% from this time a year ago. Range Resources was up 3% on Wednesday afternoon at $14.57, i a 52-week range of $11.93 to $30.30 and with a consensus target price of $22.85. It has a 0.6% dividend yield and a $3.6 billion market cap.

Cabot Oil & Gas (NYSE: COG) was only 1% higher on Wednesday, but the independent oil and gas company was last seen trading down 16% so far in 2018. The stock was up 1% on Wednesday afternoon at $24.09, in a 52-week range of $21.40 to $29.57 and with a consensus target price of $31.16. It has a 1.0% dividend yield and a $11 billion market cap.

Newfield Exploration Co. (NYSE: NFX) was last seen down 16% year to date before Wednesday. That is also down about 26% from a year ago. The stock was up 6% on Wednesday afternoon at $28.00. The 52-week range is $22.72 to $37.00, and the consensus target price is $36.34. Newfield Exploration has a $5.5 billion market cap.

Williams Companies Inc. (NYSE: WMB) was down over 15% coming into Wednesday, and its shares are actually down 21% over the past 90 days or so. Williams was flat on Wednesday afternoon at $25.81, in a 52-week range of $24.00 to $33.67 and with a consensus analyst target price of $34.79. It has a 5.4% dividend yield and a $21 billion market cap.

EQT Corp. (NYSE: EQT) may be more tied to natural gas and natural gas liquids than oil, and it was seen almost unchanged on Wednesday. But the stock is down 13% year to date and down over 21% from a year ago. EQT was flat on Wednesday afternoon at $49.30, in a 52-week range of $43.70 to $67.84 and with a consensus target price of $73.97. It has a 0.3% dividend yield and a $13 billion market cap.

Kinder Morgan Inc. (NYSE: KMI) has suffered along with other midstream rivals, and while master limited partnership (MLP) and MLP-like businesses have suffered, this energy infrastructure giant did just raise its dividend payment after the close on Wednesday. Kinder Morgan was last seen trading up 1% at $16.24, but its shares were down 11% year to date ahead of this move. Kinder Morgan was up 1% on Wednesday afternoon at $16.20, compared with a 52-week range of $14.82 to $21.92 and a consensus target price of $21.35. It has a 3.3% dividend yield and a $36 billion market cap.