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Apache Outperformed Oil-Weighted Stocks


Jun. 6 2019, Updated 10:33 a.m. ET

Oil-weighted stocks’ returns

On May 29–June 5, our list of oil-weighted stocks fell 6.3%—compared to the 12.1% fall in US crude oil July futures. On average, our list of oil-weighted stocks outperformed US crude oil prices.

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Apache outperformed oil-weighted stocks

Let’s take a look at the oil-weighted stocks that either rose the most or fell the least in the last five trading sessions:

  • Apache (APA) rose 5.2%.
  • Concho Resources (CXO) fell 2.1%.
  • Oasis Petroleum (OAS) fell 3.4%.

Despite a higher correlation, Apache’s share prices ignored the fall in US crude oil prices. On June 5, Apache’s share prices rose 5.4%, while US crude oil prices rose 0.4%. On the same day, the S&P 500 Index (SPY) rose 2.1%. The rise in the broader market could have been behind the upside in Apache’s stock prices. In the second quarter, based on analysts’ consensus estimates, Apache’s earnings might double on a sequential basis.

On May 30, Stephens reduced its target price on Apache by $2 to $44. On June 5, Apache’s share prices closed 3.9%, 13.4%, 14%, and 21.4% below its 20-day, 50-day, 100-day, and 200-day moving averages.

Underperformers among oil-weighted stocks

Now, we’ll discuss the oil-weighted stocks that underperformed their peers and US crude oil prices in the last four trading sessions:

  • California Resources (CRC) fell 11.2%.
  • Whiting Petroleum (WLL) fell 11.3%.
  • Denbury Resources (DNR) fell 15.6%.

These three stocks had correlations of at least 66% with US crude oil active futures. All of these oil-weighted stocks are part of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP). They operate with production mixes of at least 60% in liquids based on the latest quarterly production data.


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