Now let’s compare Anadarko Petroleum’s (APC) recent stock movements to movements in the broader market, crude oil prices, natural gas prices, and the US Dollar Index (or USDX).
Recent trends in APC stock
In the graph above, we can see that Anadarko has been mirroring the price movements of crude oil and natural gas. The correlation coefficient between Anadarko’s stock price and WTI’s (West Texas Intermediate) price (USO) from July 2015 to the present is ~0.68. This indicates a strong positive correlation between the two.
The correlation coefficient between Anadarko’s stock price and the price of natural gas (UNG) from July 2015 to the present is ~0.19. This also indicates a positive but far lower correlation between the two.
The above graph shows that APC stock has produced lower returns compared to WTI on a YoY basis. When compared to the S&P 500 ETF (SPY), APC has underperformed. SPY has returned 1.2% since July 2015. Also note that APC is negatively correlated to USDX. Since July 2015, USDX has returned -0.70%.
In the last two parts of our series, we’ll explore what institutional holders see in APC. We’ll also look at the short interest in the stock.