How Concho Resources Stock Reacted to Its 4Q16 Earnings

Following Concho Resources’ (CXO) 4Q16 aftermarket earnings release on February 21, 2017, its stock rose ~1%. However, in after-hours trading, its stock fell ~3%.

Year-over-year (or YoY), CXO has risen ~50%. In this part of the series, we’ll analyze Concho’s stock performance with respect to movements in the broader industry and the broader market.

As the graph above shows, Concho Resources’ performance has been driven mainly by WTI (West Texas Intermediate) crude oil prices (OIL) and natural gas prices (UNG). Oil and natural gas prices have also been driving the broader industry ETF, the Energy Select Sector SPDR ETF (XLE).

From February 7 to February 21, Concho Resources stock mostly overperformed XLE. Toward the end of the period, it ended up giving higher returns than the ETF. Concho Resources stock rose ~5% during the two-week period, while XLE rose ~1%.

Concho Resources stock also outperformed the SPDR S&P 500 ETF (SPY) (SPX-INDEX), which rose 3.3% during the period. CXO fell following its aftermarket earnings release on February 21, likely due to weakness in crude oil prices.

Crude was trading at $53.55 on February 22, a fall of 1% from its previous close. Additionally, CXO’s 4Q16 revenue missed estimates, likely creating skepticism.