Why Cabot Oil & Gas Stock Fell after 4Q16 Earnings



Cabot Oil & Gas stock performance

Following Cabot Oil & Gas’s (COG) 4Q16 earnings release on February 24, COG stock fell ~0.35%. YoY (year-over-year), COG has risen ~14%. In this part of the series, we’ll analyze COG’s stock performance with respect to movements in the broader industry and the broader market.

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Peer comparison

As you can see in the graph above, Cabot Oil & Gas’s performance has been driven mainly by natural gas prices (UNG). Natural gas prices and WTI (West Texas Intermediate) crude oil prices (USO) have also been driving the Energy Select Sector SPDR ETF (XLE), the broader industry ETF.

From February 10 to 24, 2017, COG stock was underperforming XLE. Toward the end of the period, COG had lower returns than XLE. COG stock fell ~6.7% during this period while XLE fell ~3.1%.

Cabot Oil & Gas makes up 1.8% of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) The SPDR S&P 500 ETF (SPY) rose ~2.3% during the two-week period.

On February 24, 2017, Cabot Oil & Gas stock fell ~0.4%, which means the markets reacted negatively to the company’s 4Q16 earnings. Indeed, the company reported less-than-expected 4Q16 earnings and revenue. The 0.38% rise in natural gas prices on February 24 seemed to have been ignored by the markets. Read the first part of this series to learn more about Cabot Oil & Gas’s 4Q16 performance.


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