Is Concho Resources Inc. (CXO) Running Out of Gas?

Concho Resources Inc. (CXO) shares saw a recent bid of $116.23 and 1.19M shares have exchanged hands in the recent trading session, yielding a -5.69% decline over the past week. The stock price decreased -0.65% or $0.76 versus $116.99 at the end of the prior session. This change led market cap to move at $17.19B, putting the price -21.23% below the 52-week high and 1.66% above the 52-week low. The company’s stock has a normal trading capacity of 1.34M shares while the relative volume is 0.87.

To stay one step ahead we extended our research by comparing different price targets. The stock notched a 12-month high of $161.33 while $210.00 target is by far the most aggressive out of analysts who are currently evaluating the company, $48.67 higher than the next highest 52-week price estimate. The lowest 12-month price target for the shares is $115.00, which would be decrease of about -1% of its current value. The mean target of $163.00 should be compared with the price when the stock was languishing around $114.33 a share. And it remains to be seen which target price CXO can achieve without sacrificing much as the company is holding a -3.79% fall for the past twelve months.

By historical standards, Concho Resources Inc. remains a cheap stock. The company’s current price-earnings ratio amounts to 103.24 times earnings, above the average P/E ratio of 20.60 times earnings. For now, Concho Resources Inc. is the toast of Wall Street as its ABR stands at 1.90 with 11 out of 34 analysts rating the stock a buy. Over the short term, some market observers may have noticed that Concho Resources Inc. has a 3.91% short float with 15 days to cover. It becomes significant when you consider how many shares are shorted versus the average daily volume, means how many days to cover those short shares at that volume. Concho Resources Inc. has far performed well this year, with the share price down -12.35% since January. Over the past 2 quarters, the stock is down -16.51%, compared with a fall of nearly -11.04% for 3 months and about -10.67% for the past 30 days.

Last time, the company shocked Wall Street by reporting EPS of $0.49, smashing the consensus of $0.29 per share. Revenue for the quarter also did not kill consensus, coming in at $612M, compared to the consensus of 616.89M. Nonetheless, from here on out, earnings per share forecasts for the current quarter are $0.43. The company is expected to report EPS as high as $0.63 and as low as $0.28 per share. Similarly, full-year EPS forecasts have ranged between $1.10 and $2.39. The mean EPS estimate is $1.64. On the other side, sales forecasts for the current quarter are $655.3M. The stock is expected to report revenue as high as $724M and as low as $594.23M per share. Similarly, full-year sales forecasts have ranged between $2.47B and $2.95B. The mean revenue estimate is $2.7B.

Over the last 5 years, Concho Resources Inc. has averaged a -36.20% YoY EPS growth rate and a 0.20% revenue growth rate. Analysts are expecting EPS growth rates to be at 102.50% this quarter and EPS estimate for next year reflect 40.37% growth rate.

Sell-side analysts also have something to say about this company. RBC Capital Mkts analysts stated on 22/02/2017 that they maintained their Outperform rating. Seaport Global Securities raised its rating on Concho Resources Inc. to Buy on 09/12/2016 in a reversal from its prior Accumulate rating. Stifel analysts stated on 12/09/2016 that they maintained their Buy rating.

Is Concho Resources Inc. (CXO) Running Out of Gas? was last modified: June 20th, 2017 by Edward Walker
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