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Concho Resources: The Fourth-Lowest Energy Performer in XLE

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Concho Resources: The fourth-lowest performer in 2018

In the first half of 2018, Concho Resources (CXO) was the fourth-lowest performer among the energy stocks in the Energy Select Sector SPDR ETF (XLE). Concho Resources’ operations are focused on acquiring, developing, and exploring oil and natural gas properties in the Permian Basin of Southeast New Mexico and West Texas. 

In the first half of 2018, CXO fell from its 2017 close of $150.22 to $138.35—a moderate decrease of ~8.0%.

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In the first half of 2018, Concho Resources underperformed the iShares Oil & Gas Exploration & Production ETF (IEO). IEO represents an index of US companies that are engaged in the exploration, production, and distribution of crude oil and natural gas. IEO has ~70.0% exposure to the oil and gas exploration and production industry. IEO rose ~15.0% in the first half.

In comparison, the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) and the Energy Select Sector SPDR ETF (XLE) rose ~16.0% and ~5.0%, respectively, in the first half.

Concho Resources’ revenues and earnings

In the first quarter, Concho Resources reported revenues of ~$947.0 million, about 55.0% higher than its revenues of ~$612.0 million in the first quarter of 2017.

In the first quarter, Concho Resources reported a strong year-over-year increase of ~107.0% in net income. In the first quarter, CXO posted an adjusted profit of ~$149.0 million from its ~$72.0 million profit in the first quarter of 2017. Concho Resources posted an adjusted profit of $1.00 per share in the first quarter from the profit of $0.49 per share in the first quarter of 2017. However, Concho Resources hasn’t reported positive free cash flows since the first quarter of 2015.

Next, we’ll compare the 2018 returns of Halliburton (HAL) with various energy ETFs and energy commodities. We’ll also analyze HAL’s earnings.

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