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How Weatherford Is Reacting to Crude Oil Price Changes

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Jan. 22 2018, Updated 9:01 a.m. ET

Weatherford’s correlation with crude oil

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Has WFT’s correlation with crude oil prices changed?

WFT’s correlation with crude oil prices was lower in the trailing year to January 16, 2018, compared to the previous year to January 16, 2017. Crude oil prices are now 21% higher than a year ago. Crude oil prices have been strong since the third week of June 2017. A low correlation implies that WFT’s stock price may not benefit much if crude oil prices rise in the near term. The VanEck Vectors Oil Services ETF’s correlation with crude oil was lower in the trailing year to January 16, 2018, compared to the previous two years.

Correlation between WFT’s peers and crude oil prices

Helmerich & Payne’s (HP) correlation coefficient since January 16, 2017, was 0.52, while McDermott International’s (MDR) was 0.40. Oil States International’s (OIS) correlation coefficient was 0.47.

Compared to Weatherford International, the correlation coefficient between stock prices for HP, MDR, and OIS and crude oil prices has also decreased in the trailing year to January 2018 from the year before.

Next in this series, we’ll discuss Wall Street analysts’ recommendations for WFT.

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