Every day I run the Momentum Trader screen no matter what’s happening in the market. Even if I’m not really looking to add a stock that day, I run it because it gives me detailed information about parts of the market I simply can’t glean in any other fashion. By looking at which industries are popping up, becoming more numerous then dwindling, I can see major underlying trends in the market. Now I’m seeing a second resurgence in the oil exploration and production space.
As a result I’ve named today’s Bull of the Day as Diamondback Energy (FANG - Snapshot Report) . The clever ticker has little to do with my choice although it’s a great choice, Diamondback is an independent oil and natural gas company focused on the acquisition, development, exploration and exploitation of onshore oil and gas reserves in the Permian Basin in West Texas. As of the end of last year, the company’s net acreage position was approximately 84,683 acres with estimated proved oil and nat gas reserves of 156,900,000 barrels of oil equivalent.
Those may sound like big numbers but the really impressive metrics show up in the evolution of the Zacks Consensus Estimates over time. Over the last sixty days, twelve analysts have increased their earnings estimates for the current quarter while ten have done so for the current year. The bullish sentiment on the street has pushed up the Zacks Consensus Estimate from 18 cents to 33 for the current quarter and hiked up next year’s number from 54 cents to 98 cents.
The meteoric rise of shares off the January lows is encouraging and terrifying at the same time. Moving from $54 to $96 from January to early June is a fantastic move. The retrace off the June highs took shares back to support at $84 where buyers gladly jumped back in to bid. The push higher off that support level is butting up against resistance at the 52-week high. I’m hoping the next push of volume here can get shares to leapfrog that level and get us on through to fresh highs over the next couple of weeks.
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