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We reiterate our Neutral recommendation on Texas-based Noble Energy Inc. (NBL - Analyst Report). The company posted dull results in the third quarter 2012 with both top and bottom lines lagging the Zacks Consensus Estimates. Weak natural gas and natural liquids prices were responsible for the downside in the third quarter.

The company’s domestic operations in the Denver/Julesburg (DJ) basin and Marcellus are expected to do good business with the continued production ramp-up thereby boosting revenue growth going forward. Also, Noble Energy’s recent dividend hike of 14% to 25 cents per share will sit well with the company’s stockholders.

However, price sensitivities owing to economic cycles and unplanned outages could upset the company’s targeted development objectives.

The company’s West African prospect, the Aseng field, continued with its steady exploration activities. Besides, the company’s refocus on deepwater Gulf of Mexico and successes in the Tamar field in the Mediterranean offer good prospects. The company’s Alen project in Equatorial Guinea is also anticipated to augment returns.

Nevertheless, most of the African as well as the Middle East countries are hotbeds for political and civil disturbances which could negatively influence the company’s business operations and near-term goals.

Noble Energy as well as its peer Anadarko Petroleum Corporation (APC - Analyst Report) currently retains a short-term Zacks #3 Rank (Hold rating). The latter is focused on maintaining its momentum with natural gas prospects from Golfinho and Atum in offshore Mozambique looking encouraging because of viable reserves addition. On the home ground, expansion of assets in the Wattenberg play in Colorado will also drive growth.

The Zacks Consensus Estimates for Noble Energy for the fourth quarter and full year 2012 currently stand at $1.02 and $4.55 per share, respectively. The recent Hurricane Sandy led to the shutdown of Noble Energy’s several deepwater operations. In view of this, the company expects 2012 sales to be on the lower end of the previously issued guidance range of 242-250 thousand barrels of oil equivalent per day (Mboe/d).

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