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EOG Resources (EOG) Jumps 24.3% YTD: Is There More Room to Run?
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EOG Resources, Inc. (EOG - Free Report) has gained 24.3% year to date (YTD), surpassing the 17% rise of the composite stocks belonging to the energy sector. Moreover, the leading upstream energy firm has witnessed upward estimate revisions for 2022 and 2023 earnings in the past 30 days.
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Factors Working in Favor
The price of West Texas Intermediate crude, trading at more than $100 per barrel, has risen drastically over the past year. EOG Resources, a leading oil and natural gas exploration and production company currently carrying a Zacks Rank #3 (Hold), is well-placed to capitalize on the crude rally. EOG has estimated 11,500 net undrilled premium locations, resulting in a brightened production outlook. In the Eagle Ford shale play alone, EOG identified 1,900 undrilled premium locations, while in the prolific Delaware Basin, the upstream firm identified 6,300 drilling sites.
EOG Resources is strongly committed to returning capital to shareholders. Since its transition to premium drilling, the company has returned more than $10 billion in cash to stockholders. With the employment of premium drilling, EOG will be able to reduce its cash operating costs per barrel of oil equivalent, thereby aiding its bottom line.
Risks
Although EOG Resources is committed to returning capital to shareholders, it has consistently been paying lower dividends than the composite stocks belonging to the energy sector over the past five years.
Rising lease and well operating costs are hurting EOG Resources’ bottom line.
Last Word
Overall, the business scenario will possibly continue to be favorable for EOG Resources. With the transition to premium drilling and footprint in prolific basins, EOG has more room to gain.
Antero Resources is a leading upstream energy player, with a strong presence in the gas-rich prolific Appalachian Basin in West Virginia and Ohio. In the past 60 days, Antero Resources has witnessed upward earnings estimate revisions for 2022 and 2023.
The substantial exposure to improving commodity prices is a huge positive for Antero Resources.
Whiting Petroleum is a leading upstream energy company and the top producer of crude oil in North Dakota. With oil prices improving rapidly, Whiting Petroleum is expected to continue generating handsome cash flows, while maintaining a healthy balance sheet.
Headquartered in Denver, CO, Whiting Petroleum has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days.
Improving oil prices is a boon for Matador Resources’ upstream operations. This is because MTDR has a strong presence in the oil-rich core acres of the Wolfcamp and Bone Spring plays in the Delaware Basin. Favorable oil price is likely to aid Matador Resources in increasing production volumes.
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EOG Resources (EOG) Jumps 24.3% YTD: Is There More Room to Run?
EOG Resources, Inc. (EOG - Free Report) has gained 24.3% year to date (YTD), surpassing the 17% rise of the composite stocks belonging to the energy sector. Moreover, the leading upstream energy firm has witnessed upward estimate revisions for 2022 and 2023 earnings in the past 30 days.
Image Source: Zacks Investment Research
Factors Working in Favor
The price of West Texas Intermediate crude, trading at more than $100 per barrel, has risen drastically over the past year. EOG Resources, a leading oil and natural gas exploration and production company currently carrying a Zacks Rank #3 (Hold), is well-placed to capitalize on the crude rally. EOG has estimated 11,500 net undrilled premium locations, resulting in a brightened production outlook. In the Eagle Ford shale play alone, EOG identified 1,900 undrilled premium locations, while in the prolific Delaware Basin, the upstream firm identified 6,300 drilling sites.
EOG Resources is strongly committed to returning capital to shareholders. Since its transition to premium drilling, the company has returned more than $10 billion in cash to stockholders. With the employment of premium drilling, EOG will be able to reduce its cash operating costs per barrel of oil equivalent, thereby aiding its bottom line.
Risks
Although EOG Resources is committed to returning capital to shareholders, it has consistently been paying lower dividends than the composite stocks belonging to the energy sector over the past five years.
Rising lease and well operating costs are hurting EOG Resources’ bottom line.
Last Word
Overall, the business scenario will possibly continue to be favorable for EOG Resources. With the transition to premium drilling and footprint in prolific basins, EOG has more room to gain.
Stocks to Consider
Some better-ranked players in the energy space are Antero Resources (AR - Free Report) , Whiting Petroleum and Matador Resources Company (MTDR - Free Report) . All companies currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Antero Resources is a leading upstream energy player, with a strong presence in the gas-rich prolific Appalachian Basin in West Virginia and Ohio. In the past 60 days, Antero Resources has witnessed upward earnings estimate revisions for 2022 and 2023.
The substantial exposure to improving commodity prices is a huge positive for Antero Resources.
Whiting Petroleum is a leading upstream energy company and the top producer of crude oil in North Dakota. With oil prices improving rapidly, Whiting Petroleum is expected to continue generating handsome cash flows, while maintaining a healthy balance sheet.
Headquartered in Denver, CO, Whiting Petroleum has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days.
Improving oil prices is a boon for Matador Resources’ upstream operations. This is because MTDR has a strong presence in the oil-rich core acres of the Wolfcamp and Bone Spring plays in the Delaware Basin. Favorable oil price is likely to aid Matador Resources in increasing production volumes.