What Has Been Driving Apache Stock Lately?


Nov. 20 2020, Updated 3:45 p.m. ET

Apache’s stock performance

Apache (APA) stock hasn’t risen as much as its peers this year. On a YoY (year-over-year) basis, Apache stock has declined 6.85%.

The broader energy sector ETF, the Energy Select Sector SPDR ETF (XLE) has increased 15.57% during the same period. Compared to the S&P 500 SPDR ETF (SPY), Apache stock has underperformed. SPY has risen 14.39% YoY.

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Key factors straining Apache stock

One of the key reasons for Apache stock’s dismal performance was its lackluster first-quarter earnings. The company reported lower YoY revenues and lower-than-expected earnings. The company also reported a decline in its production volumes in the first quarter—compared to the same period last year.

Another critical factor that has been hindering Apache stock is WTI-Midland price differentials. WTI is the benchmark crude oil, priced in Cushing, Oklahoma, while Midland is the oil priced in the Permian Basin. The differentials have impacted several Permian producers including Apache, Concho Resources (CXO) and Parsley Energy (PE). To learn more, read Rising Permian Production Has Been Straining Price Differentials.

Apache’s average crude oil price realizations in the first quarter in the United States were $61.60 per barrel. Parsley Energy saw average crude oil price realizations (without hedges) of $61.99 per barrel in the first quarter, while Concho Resources’ crude oil price realizations, including the effect of hedges, was $61.29 per barrel.

In comparison, EOG Resources (EOG) saw crude oil and condensate price realizations of $64.24 per barrel in the United States in the first quarter. EOG’s operations span across the Permian Basin, the DJ Basin, and the Eagle Ford.


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