As of December 18, 2015, the 100-day moving averages of upstream companies’ stocks showed strong resistance. For example, only Pioneer Natural Resources (PXD) managed to trade above the 100-day moving average before December 15 and is now trading 7.8% below its 100-day moving average. Additionally, EQT (EQT) and Cabot Oil and Gas (COG) were trading 28% and 30%, respectively, below their 100-day moving averages as of December 18. Upstream companies were also trading well below their 20-day moving averages.
Pioneer Natural Resources was trading above its respective 20-day until December 15 but slipped 14% below the moving average after that. Also, the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) was trading 20.4% below its 100-day moving average.
Wall Street analysts’ consensus estimate
The graph above shows several upstream companies’ moving averages and forward target prices. Wall Street analysts’ consensus estimate suggests a 55% upside for these upstream companies compared to a 27% upside for large-cap refineries. Over the next 12 months, companies like EQT and Cabot Oil and Gas could see rises of 69% and 72%, respectively, from their levels as of December 18. Below you can see Wall Street analysts’ estimates for three other upstream companies over the next 12 months:
- ConocoPhillips (COP) could see a 30% rise.
- EOG Resources (EOG) could see a 28.5% rise.
- Apache (APA) could see a 28% rise.
Interestingly, the forward PE (price-to-earnings ratio) for next year suggests that ConocoPhillips is comparatively cheaper than other upstream companies.