CNOOC Remains Neutral - Analyst Blog
15 5월 2013 - 12:40AM
Zacks
We reaffirmed our Neutral
recommendation on Chinese offshore pure play oil and gas
exploration and production (E&P) company, CNOOC
Ltd. (CEO), on May 9, 2013. Riding on growth in production
volumes, the company reported robust numbers in the first quarter.
The company holds a Zacks Rank #1, which is equivalent to a
short-term Strong Buy rating.
Why Maintained?
Headquartered in Hong Kong, CNOOC is one of the three oil companies
in China and among the leading independent oil and gas E&P
companies of the world. The company is a dominant producer of
offshore crude oil and natural gas and engages in the exploration,
development, production as well as sale of crude oil, natural gas
and other petroleum products.
In the first quarter of 2013, CNOOC reported total revenue of 56.18
billion yuan ($8.95 billion), up approximately 14% from the
year-earlier level. The upside came primarily from growth in
production volume.
CNOOC achieved net production of 93.6 million barrels of oil
equivalent (MMBoe), up approximately 17.3% from the year-ago level.
The growth was mainly attributable to the production contribution
from the acquisition of Nexen Inc, the new oil and gas projects,
the resumption of Penglai 19-3 oil field and the overseas projects.
Overseas production and steady performances by the already
operational oil and gas fields also aided the increase.
CNOOC also has a strong growth profile, exclusivity in the offshore
China region and attractive liquefied natural gas investments.
Also, we are bullish on the company in the near term owing to its
strong revenue growth and significant asset acquisitions.
Over the longer run, however, these positives will likely be
somewhat negated by unpredictable oil and gas prices, which are
inherently volatile and subject to complex market forces. Realized
prices could differ significantly from our estimates, thereby
affecting the company’s revenues, earnings and cash flow.
Additionally, the company’s future is closely linked with the
successful completion of its growth projects, which in turn, might
be adversely affected by operational hindrances, cost inflations
and overruns and delays in completion.
Other Stocks to Consider
There are other stocks in the sector that also appear rewarding.
These include EPL Oil & Gas, Inc. (EPL),
Dawson Geophysical Company (DWSN) and SM
Energy Company (SM), which are expected to perform
impressively over the next few months and carry a Zacks Rank #1
(Strong Buy).
CNOOC LTD ADR (CEO): Free Stock Analysis Report
DAWSON GEOPHYS (DWSN): Free Stock Analysis Report
EPL OIL&GAS INC (EPL): Free Stock Analysis Report
SM ENERGY CO (SM): Free Stock Analysis Report
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