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Upstream Stocks: 100-Day Moving Averages Show Strong Resistance

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Jan. 28 2016, Updated 9:19 a.m. ET

Moving averages

The 100-day moving averages of upstream companies’ stocks have shown strong resistance. The ten large-capped upstream companies are trading 22% below their 100-day moving averages. Only EQT (EQT) and Cabot Oil & Gas (COG) managed to trade 3.8% and 3.2% below their respective 100-day moving averages.

This is close to the averages when compared to other upstream companies. For example, Marathon Oil (MRO) is trading 43% below its 100-day moving average, and that’s highest among the upstream companies. On the other hand, Anadarko Petroleum (APC) and Devon Energy (DVN) trade 39% and 36% below their respective 100-day moving averages.

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Anadarko Petroleum’s 52-week highs were around $94.5 during April 2015. Since then, the stock has been in a continuous downtrend. Anadarko operates with a production mix of 51.2% in natural gas and 34.6% in crude oil. Additionally, the stock is trading near the psychological support level of $30. However, the support price of $30 stood firm in the subprime crisis in 2008 and also in 2010.

Wall Street analysts’ consensus estimates

The table above shows the moving averages and forward target prices of several US-based (SPY) upstream companies. Wall Street analysts’ consensus estimates suggest a 46.0% upside for these upstream companies. You can compare that to the 42.2% upside estimates for large-cap refineries. Over the next 12 months, EQT and Cabot Oil & Gas could rise by as much as 24% and 14.5%, respectively, from current levels.

Wall Street analysts’ estimates for three other major upstream companies over the next 12 months are as follows:

  • APC could see a 75% rise.
  • EOG Resources (EOG) could rise by 25%.
  • Apache (APA) could see a 22% rise.
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