Oilfield Services Stocks: Wall Street’s Best and Worst for 1Q17
In this part of the series, we’ll analyze the correlation between the worst OFS (oilfield services and equipment) companies and crude oil.
In this part of the series, we’ll analyze the correlation between the top OFS companies and crude oil prices.
In this part of the series, we’ll compare the implied volatilities of the top OFS companies as rated by Wall Street analysts for 1Q17.
Short interest in Flotek Industries (FTK) as a percentage of float has risen to 26.4% as of March 22, 2017, compared to 25.9% as of December 30, 2016.
According to Enterprise Products Partners’ (EPD) 2017 Investor Day presentation, most analysts expect the global oil market to balance by 2H17.
According to Enterprise Products Partners (EPD), ethylene plants currently under construction in the US are expected to consume 770 Mbpd of ethane.
For Seadrill, Danske Bank reduced its target price to ten Norwegian kroner. Evercore reduced its target price to $1 from $2 and maintained a “sell” rating.
In February, two drilling permits were issued to drill a new well in the shallow water of the Gulf of Mexico. In the previous month, one permit was issued.
For the week ending March 17, 2017, the US offshore rig count fell to 19 from 20 in the prior week. The offshore rig count continued to sway.
Although oil prices are expected to rise in 2017, it won’t benefit the offshore drilling industry. It will be the third year that spending hasn’t risen.
March couldn’t keep up the pace. Contracting activity fell compared to the previous month. As of mid-March, six new contracts had been announced.
Since the beginning of 2017, Seadrill stock has been hit hard among offshore drilling stocks. The company is having a hard time surviving the downturn.
US power generation is dominated by natural gas since gas-fired generation has become more economical in the last few years.
The EIA estimated that four-week average US gasoline demand rose by 205,000 bpd (barrels per day) to 8,968,000 bpd from March 3–10, 2017.
For the week ending March 10, 2017, the EIA reported that US gasoline inventories fell by 3.1 MMbbls to 246.3 MMbbls.
On March 21, 2017, the API released its weekly crude oil inventory report. It reported that US crude oil inventories fell by 4.5 MMbbls from March 10–17.
Crude oil prices are trading at a four-month low. However, broader markets like the S&P 500 and the NASDAQ Composite Index are near all-time highs.
Crude oil (XOP) (UCO) (USL) prices hit a 20-month high on February 23, 2017, due to major producers’ production cut deal. Prices are ~12% below their peak.
In this part of the series, we’ll discuss the consensus recommendations for these companies. In week 11, Tsakos Energy Navigation (TNP) released its 4Q16 earnings.
Overall bunker fuel prices in week 11 fell compared to the previous week, mainly due to steady crude oil prices and ample bunker fuel inventories.