RPC versus peers and industry
RPC (RES) is a US-based oil and gas equipment and services (or OFS) company. On February 17, 2016, RPC was trading at $13.64, a 1% fall from its price a year ago.
The VanEck Vectors Oil Services ETF (OIH), an ETF tracking an index of 25 OFS companies, has fallen 35% in the past year. Seadrill (SDRL), RES’s smaller-market-cap peer, has fallen 85% during the same period. The entire OFS industry has been negatively affected by the energy price crash since June 2014.
What does RPC’s share price movement tell us?
RPC’s share price has been steady in the stock market, as opposed to many of its peers in the OFS industry, which tumbled in the past year. RES’s revenues in the past four quarters showed signs of resilience, although its bottom line suffered in the face of weak demand for OFS products and services.
In July 2015, RPC suspended its quarterly dividend. RES’s share price has gathered some steam since its one-year low in October 2015. It has recovered 60% since then. RPC makes up 0.08% of the Vanguard Energy ETF (VDE).
RPC’s moving averages
On February 17, RPC’s share price was at a 14% premium to its 50-day moving average. It’s currently trading 10.6% above its 200-day moving average.
Moving averages exhibit smoother trends in a stock’s price movements. A 50-day moving average is a short-term moving average, while a 200-day moving average shows a long-term trend. RES’s share price kept close to its long-term moving average in November 2015 and pulled ahead of its short-term moving average from October to December 2015.
As of February 2016, RES’s share price has started to run ahead of its short-term and long-term moving averages, further reinforcing the relative strength in its price.
We’ll discuss RPC’s top line and bottom line growth, its balance sheet, and its valuation multiples in this series. We’ll start with its management’s comments in the next part.