Noble Energy’s stock performance
Following Noble Energy’s (NBL) 4Q17 earnings release on February 20, 2018, its stock rose ~11% the same day.
The day before Noble Energy released its earnings, the company announced that it signed agreements to sell natural gas from the Leviathan and Tamar fields to Dolphinus Holdings Limited to supply gas in Egypt. The agreements are for total contract quantities of 1.15 trillion cubic feet of natural gas. The news likely supported Noble Energy stock.
On the day of Noble Energy’s earnings release, the company also provided its outlook through 2020. Management expects its production volumes to grow to ~525 Mboepd (thousand barrels of oil equivalent per day) in 2020, which represents a 20% compound annual growth rate from the levels in 2017. Noble Energy’s oil volumes are expected to grow at more than a 25% compound annual growth rate. Noble Energy also expects to generate $1.5 billion of excess cash flows through 2020 in a $50 oil price scenario and an additional $1.5 billion at strip pricing. Currently, oil prices are trading at $61.2 per barrel.
On a YoY (year-over-year) basis, Noble Energy stock has declined ~24%.
As you can see in the above graph, Noble Energy’s performance has mostly been driven by WTI crude oil prices and natural gas prices.
Energy prices have also impacted the Energy Select Sector SPDR ETF’s (XLE) performance, which has fallen ~5.6% YoY.
Noble Energy stock, along with XLE and crude and natural gas prices, has underperformed the SPDR S&P 500 ETF (SPY). SPY has risen ~18.4% YoY.