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Here's Why Hold Strategy is Apt for EOG Resources (EOG)
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EOG Resources, Inc. (EOG - Free Report) is a leading upstream energy player. In the past year, the stock has gained 17.9% against 0.2% decline of the composite stocks belonging to the industry.
Factors Working in Favor
The price of West Texas Intermediate crude, trading at more than the $80 per barrel mark again, is highly favorable for upstream operations. 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 promising business scenario. It has an estimated 11,500 net undrilled premium locations, resulting in a brightened production outlook.
EOG Resources is strongly committed to returning capital to shareholders. Since transitioning to premium drilling, the company has returned significant 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
Rising lease and well-operating costs are hurting the company’s bottom line. Also, being an exploration and production company, EOG’s business is highly exposed to extreme volatility in oil and gas prices.
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Profire Energy is mainly focused on the oil and gas industry’s upstream, midstream and downstream transmission segments. PFIE has boosted that its legacy business is doing extremely well, thanks to the resumption of maintenance work of exploration and production players.
Murphy, a leading retailer of gasoline and convenience merchandise, has a solid business model.
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Here's Why Hold Strategy is Apt for EOG Resources (EOG)
EOG Resources, Inc. (EOG - Free Report) is a leading upstream energy player. In the past year, the stock has gained 17.9% against 0.2% decline of the composite stocks belonging to the industry.
Factors Working in Favor
The price of West Texas Intermediate crude, trading at more than the $80 per barrel mark again, is highly favorable for upstream operations. 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 promising business scenario. It has an estimated 11,500 net undrilled premium locations, resulting in a brightened production outlook.
EOG Resources is strongly committed to returning capital to shareholders. Since transitioning to premium drilling, the company has returned significant 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
Rising lease and well-operating costs are hurting the company’s bottom line. Also, being an exploration and production company, EOG’s business is highly exposed to extreme volatility in oil and gas prices.
Stocks to Consider
Better-ranked players in the energy space include Evolution Petroleum Corporation (EPM - Free Report) , Profire Energy, Inc. (PFIE - Free Report) and Murphy USA (MUSA - Free Report) . All the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Profire Energy is mainly focused on the oil and gas industry’s upstream, midstream and downstream transmission segments. PFIE has boosted that its legacy business is doing extremely well, thanks to the resumption of maintenance work of exploration and production players.
Murphy, a leading retailer of gasoline and convenience merchandise, has a solid business model.