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Statoil Stock Ranks 2nd in the Top 10 Integrated Stocks

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Sep. 27 2017, Updated 9:39 a.m. ET

Statoil stock performance in 3Q17

Statoil (STO) stock has provided the second-highest returns among the ten stocks being compared in this series. The stock with the highest returns is Petrobras (PBR), which we discussed in the previous part. Let’s look at the performance of Statoil stock in this article.

Statoil stock has risen 18.3% in 3Q17 (since July 3, 2017), outperforming the broad market indicator, the SPDR Dow Jones Industrial Average ETF Trust (DIA). DIA has risen 4.7% during the same period.

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Statoil’s moving averages

In 3Q17, Statoil’s 50-day moving average (or 50-DMA) has crossed over its 200-day moving average (or 200-DMA). This is a bullish technical sign, which could lead to an acceleration in the rise of its stock price. STO’s 50-DMA, which stood 0.7% below its 200-DMA on July 3, now stands 3.2% above its 200-DMA.

Why the rise in Statoil stock?

Statoil (STO) stock’s correlation coefficient versus WTI for the past one-year period stood at 0.67, implying a strong positive correlation. WTI prices rose 8.4% in 3Q17, which could have boosted Statoil stock.

Statoil reported strong 1H17 numbers in 3Q17. STO’s net operating income rose due to an across-the-board rise in segmental earnings.

Statoil experienced a series of events in its Upstream segment in 3Q17. The company started production at its Byrding field, which is estimated to have recoverable volumes of 11 million barrels of oil equivalent (or boe). The field is located in the North Sea.

Also, in the quarter, Statoil progressed with its installation activities at its mega Johan Sverdrup field. This field, which has recoverable resources of ~2 billion–3 billion boe, is expected to start production in 4Q19.

In 3Q17, STO announced a small gas discovery in the Gemini North well in the Barents Sea, which marked the third discovery in its 2017 exploration campaign in the Barents Sea.

STO signed an agreement with YPF (YPF) for onshore exploration in the Bajo del Toro block in Argentina. Statoil also garnered participating interests in two offshore frontier blocks in South Africa, expanding its Upstream portfolio.

In the next part, we’ll look at the stock returns of Suncor Energy (SU) in 3Q17.

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