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What Drove Oasis Petroleum’s Stock Higher after Fiscal 4Q15?

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Oasis Petroleum’s stock performance

Following Oasis Petroleum’s (OAS) fiscal 4Q15 earnings release, OAS stock rose ~3%. The stock has declined ~71% YoY (year-over-year). In the graph below, you can see OAS’s stock performance with respect to movements in the broader industry and the broader market.

From February 10–25, 2016, OAS outperformed the Energy Select Sector SPDR ETF (XLE), which represents the broader energy industry. XLE has fallen ~29% YoY. OAS also outperformed the broader market SPDR S&P 500 ETF (SPY), which has fallen ~7% YoY.

In the above graph, it’s clear that OAS’s performance has been driven mainly by WTI (West Texas Intermediate) crude oil prices. This and natural gas prices have been the major drivers of XLE’s performance.

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After OAS’s 4Q15 earnings release after the Market closed on February 24, 2016, the stock closed higher the next day in spite of lackluster earnings. Crude oil prices closed 3% higher the same day. This shows that the Market’s reaction to OAS’s earnings release was not necessarily positive. The stock price for OAS mirrored movements in crude oil prices as did several other equity stocks.

For example, upstream peers such as Marathon Oil (MRO) and Anadarko Petroleum (APC) saw their stock prices rise by ~1.6% and ~4%, respectively, compared to the previous close. These companies combined make up ~3% of the Vanguard Energy ETF (VDE).

Read Part 1 of this series to know more about OAS’s fiscal 4Q15 and fiscal 2015 performance.

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