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Ecopetrol (EC) Stock Drops Despite Market Gains: Important Facts to Note

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Ecopetrol (EC - Free Report) closed at $8.95 in the latest trading session, marking a -1.76% move from the prior day. The stock's performance was behind the S&P 500's daily gain of 0.61%. Meanwhile, the Dow experienced a rise of 0.49%, and the technology-dominated Nasdaq saw an increase of 0.95%.

Heading into today, shares of the oil and natural gas exploration company had gained 1% over the past month, lagging the Oils-Energy sector's gain of 5.17% and the S&P 500's gain of 3.85%.

Analysts and investors alike will be keeping a close eye on the performance of Ecopetrol in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $0.52, marking a 23.81% rise compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $7.26 billion, down 12.73% from the year-ago period.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.69 per share and revenue of $29.2 billion. These totals would mark changes of +1.81% and -10.82%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Ecopetrol. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Ecopetrol is currently a Zacks Rank #3 (Hold).

In the context of valuation, Ecopetrol is at present trading with a Forward P/E ratio of 5.41. For comparison, its industry has an average Forward P/E of 10.98, which means Ecopetrol is trading at a discount to the group.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This industry, currently bearing a Zacks Industry Rank of 180, finds itself in the bottom 28% echelons of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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