Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

We reiterate our Neutral recommendation on Anadarko Petroleum Corporation (APC - Analyst Report). The company’s varied asset base comprising unconventional resources ensures its growth over the medium to long term.

Its low risk and predictable production profile, as well as speedy execution of high-impact projects, reflects its visible upside potential. This is apparent from its first quarter earnings which increased to 92 cents per share from 72 cents per share earned in the year-ago quarter.

Anadarko’s profitability is nevertheless exposed to volatile and cyclical oil, natural gas and NGL prices. Moreover, Anadarko’s failure to add to its reserves or to recover economically viable assets limits development activities both offshore and onshore.

On the bright side, the company optimizes its stock portfolio by engaging in strategic acquisitions and diversification activities. Its recent discovery of light oil in the Cote d’Ivoire region of Africa proves that it is continuously undertaking expansion activities. Additionally, the company’s strong financial position is anticipated to aid in the smooth functioning of its projects and strengthen its profitability in the coming years.

Negatives that might impede the company’s growth include exposure to unexpected natural disasters, higher oil field service costs and regulatory hurdles. Also, foreign operations are influenced by political and economic uncertainties which constrain progress of the existing programs. Capital market insecurities can thwart purchase and leasing obligations leading to operational austerities.

The company has outstripped our top and bottom line estimates in the first quarter of 2012. On a year-over-year basis, revenue increased by 6.1% to $3.45 billion.

The Zacks Consensus Estimates for the second quarter and fiscal 2012 are currently pegged at 90 cents per share and $3.93 per share, respectively.

Anadarko currently retains a Zacks #3 Rank which translates into a short-term Hold rating. The company’s peers include Apache Corporation (APA - Analyst Report) Chesapeake Energy Corporation (CHK - Analyst Report).

Based in the Woodlands, Texas Anadarko Petroleum Corporation engages in exploration, development, production and marketing of natural gas, crude oil, petroleum and natural gas liquids. Its operations are spread across the U.S. and in East and West Africa, Algeria, China, Alaska and New Zealand.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
VERTEX ENERG VTNR 8.25 +10.59%
MODINE MANUF MOD 17.12 +8.77%
CLAYTON WILL CWEI 140.03 +7.27%
E*TRADE FINA ETFC 22.67 +5.44%
KNIGHTSBRIDG VLCCF 13.22 +5.42%