Underperformance to crude oil
Cobalt International Energy (CIE) reported its 4Q16 earnings before the market opened on March 14, 2017. Excluding one-time items, CIE missed the consensus EPS (earnings per share) estimate by $0.13. Since then, CIE stock has underperformed crude oil (USO) prices. CIE stock has fallen from $0.54 to $0.45, whereas crude oil has risen from $48.40 per barrel to $49.56 per barrel during the same period.
Did CIE’s peers also underperform?
CIE’s peers Consol Energy (CNX) and Southwestern Energy (SWN) have risen ~4.0% and ~2.0%, respectively, since Cobalt International Energy’s 4Q16 earnings. The underperformance of Cobalt was more evident in light of better performances by oil and gas exploration and production companies (XOP) and the SPDR S&P 500 ETF (SPY).
Medium-term price action
What’s worrisome about CIE stock is its inability to rally despite an ~89.0% rise in crude oil prices since February 2016. CIE stock has fallen from $2.02 to $0.45 despite crude oil prices rising from a low of $26.05 to $49.56 since February, 2016.
Currently, CIE is trading below its 50-day and 200-day moving averages. On April 25, 2017, CIE stock closed at $0.45, while its 50-day and 200-day moving averages were $0.54 and $1.01, respectively. Currently, CIE stock is far below its 200-day moving average.