Andeavor's 3Q17 Stock Performance Beat the S&P 500

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Part 2
Andeavor's 3Q17 Stock Performance Beat the S&P 500 PART 2 OF 14

What Andeavor’s Moving Averages Can Tell You

Andeavor’s moving averages in 1H17

At the beginning of 2017, Andeavor (ANDV) stock fell. This fall was likely due to Andeavor’s 4Q16 earnings, which missed estimates, and high gasoline and distillate inventories. But ANDV’s 50-day moving average stayed above its 200-day moving average in the first quarter.

What Andeavor’s Moving Averages Can Tell You

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The downtrend in 1Q17 extended in the early days of the second quarter—likely in anticipation of earnings. Andeavor’s 50-day moving average broke marginally below its 200-day moving average. But as Andeavor announced its 1Q17 numbers, which beat its estimates, the stock rose. Andeavor’s 50-day moving average again surpassed its 200-day moving average. Also, the fact that Andeavor completed its Western Refining acquisition further boosted the stock.

 Andeavor’s moving averages in 3Q17

Andeavor stock continued its uptrend in 3Q17 in expectation of the 2Q17 numbers, which included one month of the combined operations of both Tesoro and Western Refining, now known as Andeavor. Andeavor’s 50-day moving average remained above its 200-day moving average. Plus, Andeavor’s refining index values rose, supporting the stock.

Although Andeavor stock saw pressure due to lower refining earnings in 2Q17, the rise in the crack spread due to Hurricane Harvey led to an overall rise in the stock in the third quarter. The rise in Andeavor stock kept its 50-day moving average way above its 200-day moving average. Currently, Andeavor’s 50-day moving average trades 11.3% above its 200-day moving average.

Peers’ moving averages

Like ANDV, HollyFrontier (HFC), PBF Energy (PBF), and Delek US Holdings’ (DK) 50-day moving averages trade 6.8%, 2.1%, and 1.0%, respectively, above their 200-day moving averages. But as PBF and DK’s 50-day moving averages are marginally above their 200-day moving averages, any adverse news on refining crack indicators or inventory levels could cause their 50-day moving averages to fall below their 200-day moving averages—a bearish technical indicator.

The broader market indicator, the SPDR Dow Jones Industrial Average ETF Trust’s, (DIA) 50-day moving average trades around 4.6% above its 200-day moving average.

To learn about Andeavor’s three-month stock price forecast range for the period ending December 31, 2017, based on its implied volatility, read on to the next part of this series.


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