How SM Energy’s Stock Price Reacted to Past Earnings
SM Energy’s stock price action
After losing ~92% of its market capitalization from September 2014 to February 2016, SM Energy’s (SM) stock price is finally showing signs of a new uptrend.
In April 2016, SM Energy’s stock crossed the 200-day moving average for the first time in last one year and currently, trading ~10% above it. Since its February 2016 bottom, SM Energy’s stock price is up by a whopping ~287%.
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SM Energy’s relative performance
Compare this with the SPDR S&P Oil and Gas Exploration & Production ETF (XOP), which is up by ~2% during the same period.
SM Energy’s year-to-date performance
For 2016, SM is underperforming other smaller upstream companies. In 2016, SM is up by ~36%. Among the other smaller oil and gas producers, Parsley Energy (PE), Continental Resources (CLR), and WPX Energy (WPX) are up by ~52%, ~99%, and ~71%, respectively.
SM Energy’s stock price performance after past earnings
SM Energy reported its 1Q16 earnings after the Market closed on May 3, 2016. In 1Q16, excluding the one-time items, SM Energy (SM) reported a loss of $0.83 per share, $0.03 better than the consensus for a loss of $0.86 per share.
Following the earnings release, in a contrarian reaction, better-than-expected earnings saw SM Energy’s stock price decrease by ~7% in the three sessions.
SM reported its 4Q15 earnings after the Market closed on February 23, 2016. In 4Q15, excluding the one-time items, SM reported a loss of $0.90 per share, $0.33 lower than the consensus for a loss of $0.57 per share.
Following the earnings release, a contrarian reaction was observed where worse-than-expected earnings saw SM Energy’s stock price increase by ~125% in the eight sessions.
Similar contrarian reactions were observed after 3Q15 and 1Q15 earnings also, when SM Energy’s stock price increased by ~22% and 3% in seven and five sessions, respectively. This occurred even after missing the consensus earnings estimates by $0.05 per share and $0.16 per share, respectively.
For its 2Q15 earnings, SM Energy’s stock price reacted positively with an increase of ~12% in one session, mainly due to the $0.54 per share beat on the earnings estimates. But considering the magnitude of the beat, the reaction was still muted.