EQT’s stock performance
Following EQT’s (EQT) 3Q17 earnings release on October 26, its stock fell ~1.3%. The stock likely fell due to the 3Q17 revenue miss (read Part 1) and fall in natural gas prices. Natural gas prices closed ~1% lower on October 26.
Since the beginning of the year, EQT has fallen 6.2%. EQT has underperformed the energy sector, as you can see in the following graph. The Energy Select Sector SPDR (XLE) has fallen ~12% since the beginning of the year.
As the above graph notes, EQT’s performance seems to have been driven mainly by crude oil prices (DBO) and natural gas prices (UNG). Crude oil prices have risen 0.65% since the beginning of the year, while natural gas prices have fallen 13% during the same period. As you can see, the recovery in crude oil prices has been recent. To learn more about the recent trends in crude oil prices, read Saudi Arabia and Russia Are Impacting Crude Oil Prices.
XLE and EQT’s stock underperformed the SPDR S&P 500 ETF (SPY) (SPX-INDEX), which rose 13.4% since the beginning of the year.
Other highlights in 3Q17
Providing an update on the timing of its Rice Energy (RICE) acquisition, the company said that it’s awaiting approval from both Rice and EQT shareholders. A special meeting is expected to be held on November 9. The transaction is expected to close in 4Q17.
In early October, EQT completed the public offering of its senior notes and floating rate notes totaling $3.0 billion. The company plans to use the proceeds to fund a portion of the cash consideration for the Rice acquisition. The proceeds are also expected to be put to use to pay expenses associated with the Rice acquisition and related transactions, and “to redeem or repay certain Company indebtedness due in 2018” and for other general purposes.