Why Has Whiting Petroleum Stock Been Sliding?



Whiting Petroleum stock

Whiting Petroleum has continued to deteriorate, as we can see in the image below. While the stock did see some upward action last week, it has given a return of -12% since the beginning of this year. It has underperformed the Energy Select Sector SPDR ETF (XLE), which gave a return of -5.5% in the same period. The broader market S&P 500 ETF (SPY) (SPX-INDEX) gave a return of ~4.4%.

Crude oil prices (USO) (UCO) have pulled WLL’s stock along with them. Concerns about growing oil supplies have resurged, which has created fresh worries about crude oil prices.

The above image shows that while crude oil prices seem to be paring their losses, WLL stock hasn’t been able to do so. The whole energy sector (XLE) has seen weakness.

With fresh concerns about oil prices, investors will be watching where the energy sector goes this week, especially as several upstream companies including Whiting Petroleum release their earnings this week.

To know about what to expect in WLL’s 4Q16 earnings, read Whiting Petroleum: Will Its 4Q16 Earnings Be Positive?

Year-over-year, Whiting has given returns of ~133% compared to XLE’s ~29%. A strong performance from WLL is likely because of its focus on debt reduction, operational efficiencies, strong cash flows, and an improving oil price environment.

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