VAALCO Energy (NYSE:EGY) Stock, Quote.Headers.trade-ideas

VAALCO Energy

VAALCO Energy Inc is an independent energy company operating in the United States. It is principally engaged in the acquisition, exploration, development, and production of crude oil and natural gas. The company operates through geographical segments namely Gabon, Egypt, Canada, Equatorial Guinea and Corporate and Other. The company generates maximum revenue from the Gabon segment.

Earnings

Large Cap

News

Small Cap

Markets

Analyst Ratings

Trading Ideas

BP plc (NYSE: BP), a leading UK-based energy company, has announced plans to sell its onshore wind business in the United States. This marks a strategic shift as the energy giant refocuses on its solar partnership and other renewable energy sources.

BP Plans to Sell U.S. Onshore Wind Division Amid Strategic Shift

Contracts

BP plc (NYSE: BP), a leading UK-based energy company, has enlisted American Bureau of Shipping (&#34;ABS&#34;) for a range of services related to the floating production unit (FPU) for its Kaskida development in the U.S. Gulf of Mexico.

BP Taps ABS for Key Kaskida FPU Services in the Gulf of Mexico

Regulations

Dividends

Buybacks

Management

MPLX

Imperial Oil Limited (AMEX:IMO) has experienced 16% growth in its share price year to date (YTD), significantly outperforming the broader oil and energy sector, which has seen a 0.3% decline. This stark disparity raises a key question for investors: Should they invest in the stock now or wait for a more favorable opportunity?

Imperial&#39;s Shares Gain 16% YTD: Should You Buy or Wait for Now?

VAALCO Energy Inc

ENERGY FINDERS INC by Energy Finders, Inc.

Energy Finders Inc

BP plc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/bp#NYSE">BP</a>), a leading UK-based energy company, has announced plans to sell its onshore wind business in the United States. This marks a strategic shift as the energy giant refocuses on its solar partnership and other renewable energy sources. The move, which came amid challenges in the wind sector, signals BP&#39;s shift from certain renewables despite previous efforts to diversify its energy portfolio.
<h2>BP to Exit Onshore Wind</h2>
The company revealed its intention to sell BP Wind Energy, which holds interests in 10 onshore wind projects across seven U.S. states, with a combined generating capacity of 1.3 gigawatts (GW). BP cited the misalignment of the business with its future growth strategies as the primary reason behind the sale. William Lin, BP&#39;s executive vice president for gas and low-carbon energy, stated that the wind business &quot;is likely to be of greater value for another owner.&quot;
The onshore wind sector has encountered significant challenges of late, including high material costs, rising interest rates and supply-chain issues. Several companies in the sector have been compelled to cancel or renegotiate contracts, laying pressure on BP&#39;s wind assets.
<h2>Focus Shifts to Lightsource BP Solar Partnership</h2>
In contrast to its wind energy divestment, BP is increasing its solar efforts. The company recently announced plans to take full ownership of Lightsource BP, Europe&#39;s largest solar developer. This move aligns with BP&#39;s broader strategy to concentrate on its solar partnership, which it considers to be on par with its current growth objectives.
The wind business sale marks a pivotal moment for BP as it realigns its energy transition strategy, pivoting away from wind energy to enhance its core oil and gas operations and focus on certain renewable sectors.
<h2>BP&#39;s Zacks Rank &amp; Key Picks</h2>
BP currently carries a Zack Rank #5 (Strong Sell).
Investors interested in the&nbsp;energy&nbsp;sector may look at some better-ranked stocks like TechnipFMC plc&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/fti#NYSE">FTI</a>), Core Laboratories Inc.&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/clb#NYSE">CLB</a>) and VAALCO Energy, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>), each carrying a Zacks Rank #2 (Buy) at present.
TechnipFMC is a leading manufacturer and supplier of products, services and fully integrated technology solutions for the energy industry, with a focus on the subsea segment in offshore basins worldwide. FTI&#39;s growing backlog ensures strong revenue visibility and supports margin improvements.
The Zacks Consensus Estimate for FTI&#39;s 2024 EPS is pegged at $1.34. The company has a Zacks Style Score of B for Value and A for Growth. It has witnessed upward earnings estimate revisions for 2025 in the past 30 days.
Core Laboratories, an oilfield services company, has a deep portfolio of sophisticated, proprietary products and services that positions it to take advantage of the growing maturity in the global hydrocarbon reserve base. CLB&#39;s expanding international upstream projects indicate a positive trajectory for revenues and profitability, especially as oil demand continues to rise globally.
The Zacks Consensus Estimate for CLB&#39;s 2024 EPS is pegged at $0.95. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
VAALCO Energy is an independent energy company involved in upstream business operations, with a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company&#39;s production outlook seems bright.
The Zacks Consensus Estimate for EGY&#39;s 2024 EPS is pegged at $0.65. The company has a Value Score of A. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
<a href="https://www.zacks.com/stock/news/2337002/bp-plans-to-sell-u-s-onshore-wind-division-amid-strategic-shift?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2337002">To read this article on Zacks.com click here.</a>

BP plc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/bp#NYSE">BP</a>), a leading UK-based energy company, has enlisted American Bureau of Shipping (&quot;ABS&quot;) for a range of services related to the floating production unit (FPU) for its Kaskida development in the U.S. Gulf of Mexico. This marks BP&#39;s sixth-operated deepwater project in the region, located in a high-margin basin. ABS will provide classification and engineering verification services for the new semi-submersible FPU, a key component in BP&#39;s growing Gulf of Mexico portfolio.
<h2>ABS&#39; Role in BP&#39;s Kaskida Development</h2>
ABS, known for its expertise in offshore exploration, will support the project with its engineering review, verification and inspection services. It will act as the certified verification agent for the U.S. Bureau of Safety and Environmental Enforcement. ABS will also serve as the independent third-party verifier for high-pressure, high-temperature subsea equipment. Miguel Hernandez, ABS&#39; senior vice president, highlighted its decades of experience in working with complex semisubmersible production platforms, particularly in the Gulf of Mexico.
In addition, it will collaborate with the United States Coast Guard to oversee the design, construction, installation and equipment for BP&#39;s Kaskida FPU.
<h2>Engineering for BP&#39;s Kaskida FPU Underway</h2>
BP has already engaged multiple firms for the engineering and design work on the FPU. Audubon Engineering is handling the topside design, while Exmar Offshore is responsible for the hull, with both contracts awarded in August 2024. The Kaskida project is expected to begin production by 2029, with the FPU capable of producing 80,000 barrels of crude oil per day from six wells in the first phase.
The Kaskida project, located approximately 250 miles southwest of New Orleans in the Keathley Canyon area, is set to unlock 275 million barrels of oil equivalent in recoverable resources. The project is part of BP&#39;s larger plan to develop 10 billion barrels of discovered resources in the Kaskida and Tiber catchment areas.
<h2>BP&#39;s Kaskida Project to Feature High-Pressure Technology</h2>
BP&#39;s Kaskida development will be the first in the Gulf of Mexico to utilize well equipment with a pressure rating of up to 20,000 pounds per square inch. This cutting-edge technology is essential for tapping deepwater reservoirs at 34,000 feet below sea level.
The involvement of ABS in this ambitious project highlights its critical role in ensuring the successful delivery of BP&#39;s largest energy development in the United States to date.
<h2>BP&#39;s Zacks Rank &amp; Key Picks</h2>
BP currently carries a Zack Rank #5 (Strong Sell).
Investors interested in the&nbsp;energy&nbsp;sector may look at some better-ranked stocks like MPLX LP, Core Laboratories Inc.&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/clb#NYSE">CLB</a>) and VAALCO Energy, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>). While MPLX currently sports a Zacks Rank #1 (Strong Buy), Core Laboratories and VAALCO Energy carry a Zacks Rank #2 (Buy) each.
MPLX derives stable fee-based revenues from long-term contracts, with minimal exposure to commodity-price fluctuations. The partnership&#39;s robust capital expenditure forecast for 2024, along with significant expansion initiatives, underscores its commitment to sustainable growth.
The Zacks Consensus Estimate for MPLX&#39;s 2024 EPS is pegged at $4.29. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Core Laboratories, an oilfield services company, has a deep portfolio of sophisticated, proprietary products and services that positions it to take advantage of the growing maturity in the global hydrocarbon reserve base. CLB&#39;s expanding international upstream projects indicate a positive trajectory for revenues and profitability, especially as oil demand continues to rise globally.
The Zacks Consensus Estimate for CLB&#39;s 2024 EPS is pegged at $0.95. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
VAALCO Energy is an independent energy company involved in upstream business operations, with a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company&#39;s production outlook seems bright.
The Zacks Consensus Estimate for EGY&#39;s 2024 EPS is pegged at $0.65. The company has a Value Score of A. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
<a href="https://www.zacks.com/stock/news/2336319/bp-taps-abs-for-key-kaskida-fpu-services-in-the-gulf-of-mexico?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2336319">To read this article on Zacks.com click here.</a>

Imperial Oil Limited (AMEX:IMO) has experienced 16% growth in its share price year to date (YTD), significantly outperforming the broader oil and energy&nbsp;sector, which has seen a 0.3% decline. This stark disparity raises a key question for investors: Should they invest in the stock now or wait for a more favorable opportunity?
<img alt="Zacks Investment Research" src="https://staticx-tuner.zacks.com/images/articles/charts/bb/77850.jpg?v=686295297" />
Image Source: Zacks Investment Research
Based in Calgary, Imperial is more than just a Canadian oil company; it&#39;s a major player with a multi-layered portfolio that includes oil and gas production, refining, marketing and chemical manufacturing. As Canada&#39;s largest jet fuel supplier and a leading asphalt producer, the integrated oil and gas company holds a significant position in the market. The company also benefits from the expertise and resources of ExxonMobil (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xom#NYSE">XOM</a>), which owns a substantial 69.6% stake.
In simple terms, IMO makes money by finding and extracting oil and gas, refining those into products like gasoline and diesel, and selling them to its customers.
So, what&#39;s fueling Imperial&#39;s rise? Let&#39;s delve into the key drivers behind its impressive YTD performance and explore whether this momentum is likely to continue or not.
<h2>Promising Factors</h2>
Strong Financial Performance and Cash Flow: IMO has consistently reported strong financial performance, with second-quarter 2024 net income of C$1.1 billion, a significant year-over-year increase from C$675 million. The company also generated C$1.6 billion in cash flow from operations during the quarter, indicating IMO&#39;s ability to generate substantial cash from its core business.
This strong cash generation allows the company to comfortably fund its shareholder returns through dividends and share buybacks while maintaining a solid cash position for growth and operational flexibility. Currently, the company carries a Momentum Score of A.
Production Growth and Operational Efficiency:&nbsp;IMO&#39;s upstream production hit a 30-year high in second-quarter 2024, averaging 404,000 barrels per day (bpd). This was driven by record output at key assets like Kearl, which achieved 255,000 bpd and Cold Lake, which saw production rise to 147,000 bpd.&nbsp;
<img alt="Imperial Oil Limited" src="https://staticx-tuner.zacks.com/images/articles/charts/dc/77877.jpg?v=703470104" />
Image Source: Imperial Oil Limited
The company has been successfully executing turnaround activities ahead of schedule and below cost expectations, reducing downtime and improving operational efficiency. This focus on cost reduction is exemplified by Kearl&#39;s significant reduction in operating costs per barrel, which is a positive long-term driver for profitability. Additionally, the Trans Mountain Pipeline Extension will boost Imperial by adding 590,000 bpd of capacity for oil sands, improving market access and pricing, and supporting growth.
Renewable Energy Investment: In response to global climate concerns and a transition to greener energy, IMO is developing Canada&#39;s largest renewable diesel facility at its Strathcona refinery. After completion, it will produce more than one billion liters of renewable diesel yearly, helping to reduce carbon emissions and positioning the company for growth in the low-carbon energy market.
This strategic investment shows that IMO is not only committed to its traditional fossil fuel business but is also expanding into more sustainable energy solutions. This may improve the company&#39;s long-term resilience and attractiveness to environmentally conscious investors.
Favorable Market Dynamics: The narrowing spread between West Texas Intermediate (&quot;WTI&quot;) and Western Canadian Select (&quot;WCS&quot;) has improved IMO&#39;s price realizations. The WTI/WCS differential has been tightening due to increased pipeline capacity, which benefits Canada&#39;s producers like IMO by improving the profitability of heavy oil exports. This reduced-price volatility and stronger price realizations in the upstream segment have led to a significant improvement in Imperial&#39;s cash flows, positioning the company well for further growth.
Shareholder-Friendly Policies: IMO has a strong track record of returning cash to its shareholders through dividends and share buybacks. In second-quarter 2024, the company declared a dividend of 60 Canadian cents per share and plans to repurchase up to 5% of its outstanding shares by the end of the year. This not only rewards investors but also signals management&#39;s confidence in the company&#39;s future performance.
<h2>IMO Stock: Cautionary Notes</h2>
Exposure to Oil Price Volatility: Like most oil and gas companies, IMO&#39;s earnings are highly sensitive to fluctuations in oil prices. While current oil prices are favorable, any downturn in the market could significantly impact the company&#39;s revenues and profitability. For example, if geopolitical tensions ease or there is a global economic slowdown, oil demand could decrease, putting pressure on prices and affecting Imperial&#39;s bottom line. Imperial&#39;s reliance on the oil sector makes it vulnerable to cyclical downturns and commodity price risks, which can lead to lower margins and weaker financial performance in challenging market conditions.
Environmental and Regulatory Risks: IMO operates primarily in Canada, where environmental regulations are stringent. The company is exposed to environmental risks, including wildfires in Western Canada, which have already posed threats to its production sites like Kearl and Cold Lake. Additionally, future carbon pricing or stricter environmental regulations could increase operating costs, affect project viability, or lead to fines and penalties if IMO fails to meet regulatory standards. The company&#39;s large-scale oil sands operations make it a target for environmental concerns, which could also affect investor sentiment.
Weaker Refining Margins: Despite strong upstream performance, IMO&#39;s downstream segment, particularly refining, faced challenges in second-quarter 2024. Refining margins were down due to weaker market conditions and softer crack spreads, particularly in gasoline and diesel. Lower refining margins reduce the company&#39;s overall profitability, particularly in periods of high oil prices when refining costs may not be fully passed on to consumers. The company&#39;s heavy reliance on refined product sales could hurt earnings if these margin pressures persist.
High CapEx Spending Commitments: IMO has significant capital expenditure (&quot;CapEx&quot;) commitments, particularly related to maintaining the company&#39;s upstream assets and advancing its renewable energy projects. While these are long-term investments that could benefit the company, the upfront costs are high, with second-quarter 2024 CapEx reaching C$462 million. &nbsp;
Furthermore, IMO&#39;s management has outlined a capital spending budget of C$1.7 billion for 2024. Any delays or cost overruns in these projects could negatively impact the company&#39;s financials in the short term. Moreover, if oil prices decline, the company could face pressure to scale back or delay its CapEx programs, which may hinder IMO&#39;s growth prospects.
Geopolitical and Market Dependence: While IMO has strong domestic operations, it is heavily concentrated in Canada and highly dependent on local market conditions. Any adverse changes in Canada&#39;s energy policies, such as increased taxes or stricter regulations on oil sands, could negatively impact the company&#39;s operations.
Additionally, Imperial&#39;s exposure to global market dynamics, such as supply chain disruptions, fluctuating demand for oil, or competition from international oil producers, could impact the company&#39;s ability to maintain its competitive position.
<h2>IMO Stock:&nbsp;Final Thoughts&nbsp;</h2>
Imperial&#39;s impressive stock performance and strategic initiatives paint a promising picture, with the company currently trading 15% away from its 52-week high. The company&#39;s strong financials, operational efficiencies and green energy investments suggest a bright future. However, factors like oil price volatility, regulatory risks and high CapEx warrant careful consideration.
Of the 15 brokers covering IMO stock, four have given Strong Buy recommendations, while 11 have rated it as Hold and there are no Sell recommendations. With a Zacks Rank #3 (Hold), waiting for a more favorable entry point may be prudent before adding the stock to your portfolio.
<h2>Key Picks</h2>
Investors interested in the energy sector might look at some better-ranked stocks like MPLX LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mplx#NYSE">MPLX</a>), sporting a Zacks Rank #1 (Strong Buy), and Vaalco Energy, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>), carrying a Zacks Rank #2 (Buy) at present.
Findlay, OH-based MPLX LP is valued at $44.68 billion. In the past year, its shares have risen 25.7%. MPLX owns and operates midstream energy infrastructure and logistics assets in the United States. It operates under two segments, namely Logistics and Storage, and Gathering and Processing.
<div>
Houston, TX-based Vaalco Energy is valued at $579.92 million. The oil and gas exploration and production company currently pays a dividend of 25 cents per share, or 4.47%, on an annual basis. EGY is an independent energy company principally engaged in the acquisition, exploration, development and production of crude oil and natural gas.
<a href="https://www.zacks.com/stock/news/2336551/imperial-s-shares-gain-16-ytd-should-you-buy-or-wait-for-now?cid=CS-BENZ-FT-analyst_blog|rank_focused-2336551">To read this article on Zacks.com click here.</a>
</div>

Imperial's Shares Gain 16% YTD: Should You Buy or Wait for Now?

SLB (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/slb#NYSE">SLB</a>), an American oilfield services company, has announced a breakthrough in sustainable lithium production at its demonstration plant in Clayton Valley, NV. The company&#39;s proprietary technology, which uses direct lithium extraction (DLE), concentration and conversion, accelerates lithium production while minimizing environmental impact.
SLB&#39;s solution is 500 times faster than any conventional method, with a significantly smaller footprint in terms of land and water usage. It produces lithium with a recovery rate of 96%.
<h2>SLB&#39;s DLE Technology Offers Unprecedented Efficiency</h2>
The company&#39;s innovative approach delivers a complete, end-to-end process that extracts lithium from brine, treats impurities and produces high-purity lithium carbonate or hydroxide. The process uses just 10% of the land required by traditional evaporation methods and returns spent brine to its source, reducing ecological impact. This efficiency translates into faster production, reducing the time from extraction to conversion to mere hours compared to up to 18 months using traditional methods.
<h2>Environmental Advantage of SLB&#39;s Lithium Extraction Process</h2>
Conventional lithium extraction through evaporation leads to significant water loss and environmental disruption, leaving behind salts and minerals. On the contrary, SLB&#39;s sustainable solution significantly reduces water usage and minimizes environmental damage. The process enhances sustainability by recycling brine and limiting the use of chemical reagents, making it an eco-friendly alternative to conventional extraction techniques.
<h2>SLB Poised for Commercial-Scale Lithium Production</h2>
The Clayton Valley demonstration plant validates SLB&#39;s technology and positions the company for commercial scalability. With the successful verification of its recovery rates, SLB has achieved the technical milestones required under its agreement with Pure Energy Minerals Ltd. This paves the way for SLB to potentially take full ownership of the Clayton Valley Project, positioning the company as a leader in responsible lithium production.
Lithium is a critical component in producing smartphones, electric vehicles (EVs) and other electrification technologies. SLB&#39;s solution is flexible enough to produce lithium chloride, carbonate, or hydroxide, adapting to market needs for different lithium-based products. With this innovation, SLB is set to play a pivotal role in the electrification economy, ensuring faster, more sustainable lithium production to meet the growing demand.
<h2>SLB&#39;s Zacks Rank &amp; Key Picks</h2>
Currently, SLB carries a Zack Rank #3 (Hold).
Investors interested in the&nbsp;energy&nbsp;sector may look at some better-ranked stocks like MPLX LP&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mplx#NYSE">MPLX</a>), Core Laboratories Inc.&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/clb#NYSE">CLB</a>) and VAALCO Energy, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>). While MPLX currently sports a Zacks Rank #1 (Strong Buy), Core Laboratories and VAALCO Energy carry a Zacks Rank #2 (Buy) each.
MPLX derives stable fee-based revenues from long-term contracts, with minimal exposure to commodity-price fluctuations. The partnership&#39;s robust capital expenditure forecast for 2024, along with significant expansion initiatives, underscores its commitment to sustainable growth.
The Zacks Consensus Estimate for MPLX&#39;s 2024 EPS is pegged at $4.29. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Core Laboratories, an oilfield services company, has a deep portfolio of sophisticated, proprietary products and services that positions it to take advantage of the growing maturity in the global hydrocarbon reserve base. CLB&#39;s expanding international upstream projects indicate a positive trajectory for revenues and profitability, especially as oil demand continues to rise globally.
The Zacks Consensus Estimate for CLB&#39;s 2024 EPS is pegged at $0.95. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
VAALCO Energy is an independent energy company involved in upstream business operations, with a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company&#39;s production outlook seems bright.
The Zacks Consensus Estimate for EGY&#39;s 2024 EPS is pegged at $0.65. The company has a Value Score of A. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
<a href="https://www.zacks.com/stock/news/2334516/slb-achieves-breakthrough-in-lithium-production-in-nevada?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2334516">To read this article on Zacks.com click here.</a>

SLB Achieves Breakthrough in Lithium Production in Nevada

Pembina Pipeline Corporation (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pba#NYSE">PBA</a>), a Canada-based oil and gas storage and transportation company, has announced a major acquisition through its joint venture Pembina Gas Infrastructure Inc. (&quot;PGI&quot;). This agreement with Veren Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vrn#NYSE">VRN</a>) involves acquiring its Gold Creek and Karr area oil batteries, coupled with a significant investment in future infrastructure development.
The strategic acquisition represents a key milestone in Pembina&#39;s growth, expanding the company&#39;s infrastructure footprint and strengthening its partnership with VRN, a prominent player in the Montney and Duvernay regions.
<h2>Details of the Agreement Between PBA &amp; VRN</h2>
The acquisition involves four batteries in the Gold Creek and Karr areas, contributing significantly to PGI&#39;s existing infrastructure. These batteries boast a natural gas handling capacity of 320 million cubic feet per day and liquids handling capacity of 53,000 barrels per day. The natural gas processed from these batteries is directed to PGI&#39;s Patterson Creek Gas Plant, with the batteries and the plant integrated into Pembina&#39;s Peace Pipeline system.
Calgary-based VRN will play a major operational role with the newly acquired assets. According to the agreement, this Canadian oil and gas exploration and production company will manage the newly acquired batteries and the existing PGI-owned batteries in the region. Under this arrangement, VRN will handle all operating costs and maintenance capital, establishing itself as the primary operator for these facilities.
PGI will invest up to C$300 million and approximately one-third of this funding has already been committed, which reflects the seriousness of the collaboration. VRN, as part of this agreement, will oversee the construction and operation of the batteries, while PGI focuses on the high-pressure gathering pipelines that support this infrastructure.
<h2>Key Financial Aspects of PBA&#39;s Acquisition</h2>
The net purchase price is C$400 million (C$240 million net to Pembina), a considerable investment that highlights the company&#39;s commitment to expanding its gas processing and handling capacity. This acquisition is expected to generate an initial annual adjusted EBITDA of approximately C$50 million (C$30 million net to Pembina), with further capital deployment anticipated to yield additional contracted EBITDA through enhanced plant utilization and corresponding fees.
<h2>PBA&#39;s Long-Term Take-or-Pay Agreement</h2>
A critical component of this transaction is the 15-year take-or-pay agreement signed between the two companies. This long-term contract provides security for PGI, with VRN committing to processing capacity at the newly acquired batteries. Additionally, the agreement includes a dedicated area, which is situated in the Gold Creek and Karr regions, where VRN is obligated to use PGI&#39;s gathering and processing services for all volumes produced.
This acquisition is not only a financial transaction but a strategic move that strengthens Pembina&#39;s existing relationships and infrastructure capabilities. VRN is a leading producer in Montney and Duvernay, two prolific gas-producing formations in Western Canada, with more than 20 years of premium drilling inventory. This transaction ensures that PGI continues to collaborate with a top-tier counterpart in the energy sector.
The transaction also involves extending the existing legacy agreements between Pembina and VRN. Under the new structure, all the purchased batteries, existing assets and future infrastructure developments will be amalgamated into a single, simplified contract structure. This streamlined approach eliminates redundant administrative processes and provides clearer, long-term commitments between the parties.
Moreover, PGI has taken steps to eliminate future non-revenue-generating capital obligations tied to previous agreements, further optimizing its financial exposure. This move reduces operating expenses and ensures that all capital deployed has a direct impact on revenue generation.
This transaction enables VRN to manage the upstream gathering and battery infrastructure, while PGI will maintain operations at the Patterson Creek Plant. This arrangement supports the ramp-up of drilling activities and the associated increase in volumes outlined in VRN&#39;s development plan, leveraging the existing unused capacity at PGI&#39;s Patterson Creek Gas Plant.
<h2>Integration and Future Plans for PBA Stock</h2>
The transaction is part of Pembina&#39;s broader strategy to enhance its infrastructure and logistics chain. Liquids from the new batteries and Patterson Creek Gas Plant will continue to be transported via the Peace Pipeline system and natural gas liquids will be processed at Pembina&#39;s Redwater Facility, ensuring smooth integration with existing operations.
To finance this acquisition, PGI will use its existing credit facility, which highlights the company&#39;s strong financial position. This deal is expected to close in the fourth quarter of 2024, subject to customary closing conditions and regulatory approvals. This acquisition aligns with Pembina&#39;s long-term goals for growth and solidifies its role as a leading midstream service provider in Western Canada.
VRN&#39;s Gold Creek and Karr area oil batteries&#39; acquisition by PBA is a strategic transaction that extends its reach into critical gas-processing regions. This collaboration with VRN ensures stable and long-term growth trajectory. The transaction brings together expanded operational capacity, enhanced infrastructure alignment and integration into Pembina&#39;s existing value chain, creating an opportunity for both companies to benefit from increased efficiencies and growth in the energy landscape of Western Canada.
<h2>Zacks Rank and Key Picks</h2>
Currently, PBA and VRN each have a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at some better-ranked stocks like VAALCO Energy, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>) and Core Laboratories Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/clb#NYSE">CLB</a>), each carrying a Zacks Rank #2 (Buy) at present.
Houston, TX-based Vaalco Energy is valued at $568.51 million. The oil and gas exploration and production company currently pays a dividend of 25 cents per share, or 4.56%, on an annual basis. EGY is an independent energy company principally engaged in the acquisition, exploration, development and production of crude oil and natural gas.
<div>
Core Laboratories is valued at $829.89 million. The company currently pays a dividend of 4 cents per share, or 0.23%, on an annual basis. Netherlands-based CLB is an oilfield services company, operating in more than 50 countries. The firm deals with providing reservoir management and production enhancement services to oil and gas companies.
<a href="https://www.zacks.com/stock/news/2333876/pembina-pipeline-to-acquire-veren-s-midstream-assets-in-c-400m-deal?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2333876">To read this article on Zacks.com click here.</a>
</div>

Mid Cap

Pembina Pipeline to Acquire Veren's Midstream Assets in C$400M Deal

The Williams Companies, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/wmb#NYSE">WMB</a>) is on an ambitious path to expand its natural gas infrastructure with the addition of 12 projects representing approximately 4.2 billion cubic feet per day (bcfd) of capacity from 2024 to 2027. This announcement was made by CEO Alan Armstrong at the Barclays CEO Energy-Power Conference on Wednesday, according to Reuters.
This latest expansion follows the Tulsa, OK-based leading oil and gas storage and transportation company&#39;s successful completion of 17 projects, which collectively contributed about 5 bcfd, between 2018 and 2023. These projects are aimed at boosting natural gas supply, especially as demand for energy increases across various sectors.
<h2>WMB&#39;s Upcoming Projects: 2024-2027</h2>
The company&#39;s growth plan for the next few years focuses heavily on critical projects such as the Louisiana Energy Gateway and Southeast Supply Enhancement pipelines. These two high-capacity projects are expected to bring substantial additional supply into the U.S. natural gas market.
One of the flagship projects in this expansion is the Louisiana Energy Gateway, a pipeline designed to deliver 1.8 bcfd of natural gas. This project is currently under construction and expected to begin service in the second half of 2025. The project will play a crucial role in increasing gas supply from regions with abundant natural resources to areas where demand is surging.
This gateway not only addresses current energy needs but also lays the groundwork for future demand in domestic and international markets, with a particular focus on liquefied natural gas (&quot;LNG&quot;) exports.
Another key project is the Southeast Supply Enhancement pipeline, designed to deliver 1.6 bcfd of natural gas. This pipeline is currently under development and expected to be operational by the fourth quarter of 2027. The $1.45 billion investment will help to meet the rising energy needs in the Mid-Atlantic and Southeastern U.S. regions, with the increasing demand for electricity generation from data centers and artificial intelligence applications.
WMB anticipates this project to play a critical role in replacing retiring coal-fired power plants with natural gas as the go-to fuel for electricity generation. With the focus on decarbonization and the transition to cleaner energy sources, the demand for natural gas is set to remain robust in the next decade.
<h2>WMB&#39;s Historical Project Success: 2018-2023 Expansion</h2>
Between 2018 and 2023, Williams brought 17 projects online, adding a total of 5 bcfd of capacity. This growth reflects the company&#39;s commitment to meeting U.S. energy demands, driven by the shift from coal to natural gas for electricity and increasing LNG export needs. Natural gas is supporting the U.S. power grid&#39;s decarbonization efforts as less efficient coal plants are phased out.
<h2>Pipeline Projects of Williams</h2>
Williams plans to introduce approximately 11.5 bcfd of capacity between 2026 and 2032, with a $10.2 billion capital expenditure. These projects will support industrial and power generation needs and enhance LNG export capabilities. Strategic project locations will ensure a steady gas supply for domestic and international markets.
<h2>WMB&#39;s M&amp;A Strategy and Focus</h2>
On the mergers and acquisitions (M&amp;A) front, WMB has taken a cautious approach in recent years. According to Armstrong, the company&#39;s recent M&amp;A activity has been focused on acquiring gas storage assets, which align with WMB&#39;s long-term strategic goals. Beyond gas storage, Armstrong expressed skepticism about other potential acquisitions, noting that the company has yet to find any attractive opportunities for bolt-on acquisitions that offer significant synergies.
This cautious approach highlights Williams&#39; focus on making strategic investments that enhance its existing asset base. However, WMB denied reports that it had made a buyout offer to Targa Resources Corp. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/trgp#NYSE">TRGP</a>), a Houston-based oil and gas storage and transportation company.
In conclusion, WMB is positioned as a key player in the U.S. energy transition, leveraging natural gas to support a cleaner energy future. With an extensive pipeline of projects and a focus on gas storage, the company is prepared to meet rising energy demands and contribute to a lower-carbon future.
<h2>Zacks Rank and Key Picks</h2>
Currently, WMB and TRGP each have a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at some better-ranked stocks like MPLX LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mplx#NYSE">MPLX</a>), sporting a Zacks Rank #1 (Strong Buy) and VAALCO Energy, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>), carrying a Zacks Rank #2 (Buy), at present.
Findlay, OH-based MPLX LP is valued at $43.3 billion. In the past year, its shares have risen 21.3%. MPLX owns and operates midstream energy infrastructure and logistics assets in the United States. It operates under two segments, namely Logistics and Storage, and Gathering and Processing.
<div>
Houston, TX-based Vaalco Energy is valued at $595.49 million. The oil and gas exploration and production company currently pays a dividend of 25 cents per share, or 4.36%, on an annual basis. EGY is an independent energy company principally engaged in the acquisition, exploration, development and production of crude oil and natural gas.
<a href="https://www.zacks.com/stock/news/2332591/williams-to-boost-natural-gas-capacity-with-12-new-projects?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2332591">To read this article on Zacks.com click here.</a>
</div>

TRGP

Williams to Boost Natural Gas Capacity With 12 New Projects

WIIM

AROC

BANL

BWLP

CTRA

EQNR

FANG

GPOR

GPRE

HAFN

MTDR

PFIE

PTEN

SDRL

SHEL

TRMD

VIST

WFRD

Shares of oil and gas companies are trading lower following reports suggesting an impending deal will restart Libyan oil production and exports.

Oceaneering International Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/oii#NYSE">OII</a>) has secured multiple awards in the U.K. North Sea region. The company&#39;s UK-based subsidiary Oceaneering International Servicesannounced several contracts with multiple operators in the region. These contracts involve decommissioning, inspection, subsea infrastructure preparation and installation support services.
The work duration for these contracts is expected to be 65 days. The contracts also include options that may be exercised to extend their duration. The management and execution of the contracts will be carried out by Oceaneering&#39;s UK North Sea hub located in Aberdeen, Scotland. &nbsp;
OII stated that the operations associated with the contracts are slated to begin in August 2024, and will be conducted with the help of the company&#39;s Island Offshore multiservice vessel (MSV) Island Frontier. The company has prolonged the charter for the MSV Island Frontier until December 2025. Oceaneering had previously used the vessel for operations in West Africa and the Black Sea.
The company stated that the recent contracts highlight its expansion into a key market and underscore its strong relationship with major clients in the UK North Sea region. They also demonstrate OII&#39;s expertise and execution capabilities in the sector.
<h2>OII&#39;s Zacks Rank and Key Picks</h2>
Currently, OII carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy&nbsp;sector are&nbsp;VAALCO Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>), MPLX LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mplx#NYSE">MPLX</a>) and TechnipFMC plc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/fti#NYSE">FTI</a>), each carrying a Zacks Rank #2 (Buy) at present.
VAALCO Energy is an independent energy company involved in upstream business operationswith a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company&#39;s production outlook seems bright.
MPLX LP owns and operates a wide range of midstream assets. The partnership&#39;s midstream assets include oil and natural gas gathering systems and transportation pipelines for crude, natural gas and refined petroleum products. MPLX is least exposed to commodity price fluctuations as it generates stable fee-based revenues. Furthermore, it surpasses its industry peers in terms of distribution yield, reflecting its commitment to returning capital to its unitholders.
TechnipFMC is a leading manufacturer and supplier of products, services and fully integrated technology solutions for the energy industry. The company&#39;s&nbsp;total backlog witnessed a record high of $13.9 million in the second quarter of 2024, indicating a year-over-year increase of 4.51%. This growing backlog ensures strong revenue growth for FTI in the future.
<a href="https://www.zacks.com/stock/news/2329682/oceaneering-secures-multiple-contracts-in-the-uk-north-sea?cid=CS-BENZ-FT-analyst_blog|company_news_energy_sector-2329682">To read this article on Zacks.com click here.</a>

Oceaneering Secures Multiple Contracts in the UK North Sea

MPLX LP&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mplx#NYSE">MPLX</a>) reported second-quarter 2024 earnings of $1.15 per unit, which topped the Zacks Consensus Estimate of 98 cents. The bottom line also increased from the year-ago quarter&#39;s figure of 91 cents.
Total quarterly revenues of $3.05 billion beat the Zacks Consensus Estimate of $2.92 billion. The top line also increased from the prior-year quarter&#39;s level of $2.69 billion.
Strong quarterly results were primarily driven by higher gathered and processed throughput volumes. An increase in total pipeline throughputs also contributed to the same.
<div class="chart_embed">
<h3>MPLX LP Price, Consensus and EPS Surprise</h3>
<img alt="MPLX LP Price, Consensus and EPS Surprise" src="https://staticx-tuner.zacks.com/images/charts/4c/1723036553.png" style="height:265px; width:577px" title="" />
MPLX LP price-consensus-eps-surprise-chart | MPLX LP Quote
</div>
<h3>Segmental Highlights</h3>
MPLX&#39;s adjusted EBITDA from the&nbsp;Logistics and Storage&nbsp;segment increased to $1.13 billion from $1.02 billion a year ago. The strong performance was driven by increased rates, including growth from equity affiliates. Further, total pipeline throughputs in the second quarter were 6 million barrels per day, up 1% from the year-ago quarter&#39;s level.
Adjusted EBITDA from the&nbsp;Gathering and Processing&nbsp;segment totaled $524 million, up from $509 million in the prior-year quarter. The segment was aided by an increase in volumes, including contributions from the recently acquired assets. However, higher operating expenses offset the positives to some extent.
Gathering throughput volumes averaged 6.6 billion cubic feet per day (Bcf/d), implying a 7% increase from the year-ago period&#39;s level. Natural gas processed volumes came in at 9.6 Bcf/d, indicating a 7% increase from the prior-year quarter&#39;s level.
<h3>Costs and Expenses</h3>
MPLX&#39;s total costs and expenses were $1.63 billion, up from the year-ago quarter&#39;s reported figure of $1.52 billion. The increase can be attributed to higher operating expenses (including purchased product costs) and increased general and administrative expenses.
<h3>Cash Flow</h3>
Distributable cash flow in the quarter totaled $1.4 billion, providing 1.6X distribution coverage. The figure increased from $1.32 billion in the year-ago quarter.
Adjusted free cash flow increased to $1.45 billion from $1.16 billion in the corresponding period of 2023.
<h3>Balance Sheet</h3>
As of Jun 30, 2024, the partnership&#39;s cash and cash equivalents were $2.5 billion, and its total debt amounted to $22.1 billion.
<h3>Outlook</h3>
MPLX has reiterated its projection for 2024 capital spending to $1.1 billion.
<h3>Zacks Rank and Key Picks</h3>
Currently, MPLX carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy&nbsp;sector are&nbsp;SM Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sm#NYSE">SM</a>), VAALCO Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>) and&nbsp;Energy Transfer LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/et#NYSE">ET</a>). SM Energy presently sports a Zacks Rank #1 (Strong Buy), while VAALCO and Energy Transfer carry a Zacks Rank #2 (Buy) each.
SM Energy is an upstream energy firm operating in the prolific Midland Basin and the South Texas regions. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.
VAALCO Energyis an independent energy company involved in upstream operation business with a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company&#39;s production outlook seems bright.
Energy Transfer is a midstream player that owns and operates one of the most diversified portfolios of energy assets in the United States. Boasting a pipeline network extending more than 125,000 miles, its network spans over 44 states. With a presence in all the major U.S. production basins, the company&#39;s outlook seems positive.
<a href="https://www.zacks.com/stock/news/2318206/mplx-q2-earnings-top-on-higher-throughput-volumes?cid=CS-BENZ-FT-analyst_blog|earnings_article-2318206">To read this article on Zacks.com click here.</a>

Earnings Beats

MPLX Q2 Earnings Top on Higher Throughput Volumes

VAALCO Energy shares are trading higher after the company reported better-than-expected Q2 financial results.

The Company expects&nbsp;third quarter&nbsp;2024&nbsp;NRI sales to be between&nbsp;21,700&nbsp;and 24,000&nbsp;BOEPD, reflecting the addition of the C&ocirc;te d&#39;Ivoire volume for an entire quarter.

Guidance

VAALCO Energy Expects Q3 NRI Sales To Be Between 21,700 And 24,000 BOEPD

VAALCO Energy (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EGY#NYSE">EGY</a>) reported quarterly earnings of $0.22 per share which beat the analyst consensus estimate of $0.14 by 57.14 percent. The company reported quarterly sales of $116.778 million which beat the analyst consensus estimate of $99.770 million by 17.05 percent. This is a 6.90 percent increase over sales of $109.240 million the same period last year.

VAALCO Energy Q2 2024 Adj. EPS $0.22 Beats $0.14 Estimate, Sales $116.778M Beat $99.770M Estimate

ACDC

AESI

ARCH

BORR

CEIX

CHRD

CLMT

CRGY

DINO

GLNG

GPRK

LBRT

LTBR

TALO

VNOM

WTTR

Shares of oil and gas stocks are trading lower despite Middle East tensions. Weak US economic data may be weighing on demand outlook.

While &quot;the trend is your friend&quot; when it comes to short-term investing or trading, timing entries into the trend is a key determinant of success. And increasing the odds of success by making sure the sustainability of a trend isn&#39;t easy.
The trend often reverses before exiting the trade, leading to a short-term capital loss for investors. So, for a profitable trade, one should confirm factors such as sound fundamentals, positive earnings estimate revisions, etc. that could keep the momentum in the stock alive.
Investors looking to make a profit from stocks that are currently on the move may find our &quot;Recent Price Strength&quot; screen pretty useful. This predefined screen comes handy in spotting stocks that are on an uptrend backed by strength in their fundamentals, and trading in the upper portion of their 52-week high-low range, which is usually an indicator of bullishness.
Vaalco Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>) is one of the several suitable candidates that passed through the screen. Here are the key reasons why it could be a profitable bet for &quot;trend&quot; investors.
A solid price increase over a period of 12 weeks reflects investors&#39; continued willingness to pay more for the potential upside in a stock. EGY is quite a good fit in this regard, gaining 16.1% over this period.
However, it&#39;s not enough to look at the price change for around three months, as it doesn&#39;t reflect any trend reversal that might have happened in a shorter time frame. It&#39;s important for a potential winner to maintain the price trend. A price increase of 16.1% over the past four weeks ensures that the trend is still in place for the stock of this oil and natural gas explorer.
Moreover, EGY is currently trading at 93.8% of its 52-week High-Low Range, hinting that it can be on the verge of a breakout.
Looking at the fundamentals, the stock currently carries a Zacks Rank #2 (Buy), which means it is in the top 20% of more than the 4,000 stocks that we rank based on trends in earnings estimate revisions and EPS surprises -- the key factors that impact a stock&#39;s near-term price movements.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988.
Another factor that confirms the company&#39;s fundamental strength is its Average Broker Recommendation of #1 (Strong Buy). This indicates that the brokerage community is highly optimistic about the stock&#39;s near-term price performance.
So, the price trend in EGY may not reverse anytime soon.
<a href="https://www.zacks.com/stock/news/2310623/recent-price-trend-in-vaalco-energy-egy-is-your-friend-here-s-why?cid=CS-BENZ-FT-tale_of_the_tape|recent_price_strength_screen-2310623">To read this article on Zacks.com click here.</a>

Recent Price Trend in Vaalco Energy is Your Friend, Here's Why

RPC Inc.&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/res#NYSE">RES</a>) reported second-quarter 2024 adjusted earnings of 15 cents per share, which beat the Zacks Consensus Estimate of 13 cents. The bottom line declined from the year-ago quarter&#39;s figure of 30 cents.
Total quarterly revenues were $364.2 million, down from the year-ago quarter&#39;s $415.9 million. The top line also missed the Zacks Consensus Estimate of $386 million.
The better-than-expected quarterly earnings were driven by margin improvement across various key service lines and lower cost of revenues. However, the positives were partially offset by lower activity levels in pressure pumping.
<div class="chart_embed">
<h3>RPC, Inc. Price, Consensus and EPS Surprise</h3>
<img alt="RPC, Inc. Price, Consensus and EPS Surprise" src="https://staticx-tuner.zacks.com/images/charts/f5/1721997296.png" style="height:265px; width:570px" title="" />
RPC, Inc. price-consensus-eps-surprise-chart | RPC, Inc. Quote
</div>
<h3>Segmental Performance</h3>
Operating profit in the Technical Services segment totaled $30.2 million, lower than the year-ago quarter&#39;s $77 million. The results were primarily influenced by decreased activity levels in pressure pumping, leading to negative impacts on fixed costs, especially labor, due to reduced leverage.
Operating profit in the Support Services segment amounted to $4.4 million, lower than the year-ago quarter&#39;s $7.9 million. The results were driven by higher activity within rental tools, partially offset high fixed-cost structure inherent in these service lines.
Total operating profit in the quarter was $35.5 million, down from $82.4 million reported in the year-ago quarter. The average domestic rig count was 603, marking a 16.1% decline from the year-ago quarter&#39;s level.
The average oil price in the quarter was $81.78 per barrel, up 11.2% year over year. The average price of natural gas was $2.07 per thousand cubic feet, down 4.2% from the figure recorded in the corresponding period of 2023.
<h3>Costs &amp; Expenses</h3>
In the second quarter, the cost of revenues decreased to $262.3 million from $265.8 million in the prior-year period. Selling, general and administrative expenses amounted to $37.4 million, lower than the year-ago quarter&#39;s $43.6 million.
<h3>Financials</h3>
RPC&#39;s total capital expenditure was $75 million.
As of Jun 30, the company had cash and cash equivalents of $261.5 million, andmanaged to maintain a debt-free balance sheet.
<h3>Outlook</h3>
The company reiterated its capex guidance for 2024 between $200 million ad $250 million.
<h3>Zacks Rank and Key Picks</h3>
Currently, RES carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the energy&nbsp;sector are&nbsp;SM Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sm#NYSE">SM</a>), VAALCO Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>) and&nbsp;Energy Transfer LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/et#NYSE">ET</a>). SM Energy presently sports a Zacks Rank #1 (Strong Buy), while VAALCO and Energy Transfer carry a Zacks Rank #2 (Buy) each.
SM Energy is an upstream energy firm operating in the prolific Midland Basin and the South Texas regions. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.
VAALCO Energy is an independent energy company involved in upstream operation business with a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company&#39;s production outlook seems bright.
Energy Transfer is a midstream player that owns and operates one of the most diversified portfolios of energy assets in the United States. Boasting a pipeline network extending more than 125,000 miles, its network spans over 44 states. With a presence in all the major U.S. production basins, the company&#39;s outlook seems positive.
<a href="https://www.zacks.com/stock/news/2310088/rpc-res-q2-earnings-outpace-estimates-revenues-lag?cid=CS-BENZ-FT-analyst_blog|earnings_article-2310088">To read this article on Zacks.com click here.</a>

RPC Q2 Earnings Outpace Estimates, Revenues Lag

As of July 26, 2024, three stocks in the energy sector could be flashing a real warning to investors who value momentum as a key criteria in their trading decisions.
The RSI is a momentum indicator, which compares a stock&#8217;s strength on days when prices go up to its strength on days when prices go down. When compared to a stock&#8217;s price action, it can give traders a better sense of how a stock may perform in the short term. An asset is typically considered overbought when the <a href="https://www.benzinga.com/topic/rsi">RSI is above 70</a>, according to <a href="https://pro.benzinga.com/">Benzinga Pro</a>. 
Here's the latest list of major overbought players in this sector.
<h3 class="wp-block-heading">Nabors Industries Ltd. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NBR#NYSE">NBR</a>)</h3>
<ul>
<li>On July 23, Nabors Industries posted better-than-expected quarterly sales. Anthony G. Petrello, Nabors Chairman, CEO and President, commented, &#8220;Our second quarter operating results were better than we expected. This performance was driven by growth and higher average daily margins in our International Drilling segment, as well as stronger performance in our Drilling Solutions and Rig Technologies segments.&#8221; The company's stock gained around 45% over the past month and has a <a href="https://www.benzinga.com/quote/NBR">52-week high of $141.47</a>.</li>
<li>RSI Value: 76.76&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</li>
<li>NBR Price Action: Shares of Nabors Industries gained 12.7% to close at $100.81 on Thursday.</li>
</ul>
<h3 class="wp-block-heading">VAALCO Energy, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EGY#NYSE">EGY</a>)</h3>
<ul>
<li>VAALCO Energy will issue its second quarter earnings release on Tuesday, Aug. 6, after the closing bell. The company's stock gained around 13% over the past month and <a href="https://www.benzinga.com/quote/EGY">has a 52-week high </a>of $7.50.</li>
<li>RSI Value: 70.27</li>
<li>EGY Price Action: Shares of VAALCO Energy gained 2.9% to close at $7.20 on Thursday.</li>
</ul>
<h3 class="wp-block-heading">Oceaneering International Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/OII#NYSE">OII</a>)</h3>
<ul>
<li>On July 24, Oceaneering International posted better-than-expected quarterly sales. Roderick A. Larson, President and Chief Executive Officer of Oceaneering, stated, &#8220;Activity levels in our energy-related businesses, led by Subsea Robotics (SSR), increased and outperformed our expectations. Our adjusted EBITDA was in line with our guidance and consensus estimates.&#8221; The company's stock gained around 28% over the past month and has a <a href="https://www.benzinga.com/quote/OII">52-week high</a> of $29.17.</li>
<li>RSI Value: 75.67</li>
<li>OII Price Action: Shares of Oceaneering International gained 13.8% to close at $28.95 on Thursday.</li>
</ul>
Read Next: 
<ul>
<li><a href="https://www.benzinga.com/news/earnings/24/07/39978094/s-p-500-nasdaq-settle-lower-as-tech-stocks-continue-to-falter-greed-index-in-fear-zone">S&amp;P 500, Nasdaq Settle Lower As Tech Stocks Continue To Falter: Greed Index In &#8216;Fear&#8217; Zone</a></li>
</ul>

Short Ideas

Pre-Market Outlook

Top 3 Energy Stocks That May Implode This Quarter

Key highlights:
<ul>
<li>Updated SEC net proved reserves as of December 31, 2023 of 16.9 million barrels of oil equivalent (&quot;MMBOE&quot;) (93%&nbsp;oil), significantly higher than previous 1P working interest (&quot;WI&quot;) CPR reserves of 13.0 MMBOE (99%&nbsp;oil) as of October 1, 2023;</li>
<li>Increased 2P WI CPR reserves as of December 31, 2023 to 22.5 MMBOE (93%&nbsp;oil) from 21.7 MMBOE (97%&nbsp;oil) estimate; and</li>
<li>Significant further upside identified from contingent resources at the Baobab field with Best Estimate Working Interest Contingent Resources (&quot;2C&quot;) of 20.4 MMBOE. 
	&nbsp;</li>
</ul>
George Maxwell, VAALCO&#39;s Chief Executive Officer commented, &quot;We are very pleased with the results of our third-party reserve engineer&#39;s calculation of proved reserves as of December 31, 2023 for Svenska that shows even greater reserves than we initially disclosed. This strategic and highly cost-effective acquisition strategically expands our West African focus area with a sizeable producing asset that has significant upside potential and considerable future development opportunities in C&ocirc;te d&#39;Ivoire, a well-established and investment-friendly country. This transaction was highly accretive on key metrics to our shareholder base and provides another strong asset to support future growth.&quot;

VAALCO Energy Announces Positive Updates On Svenska Acquisition, Increasing Proved Reserves To 16.9 MMBOE

Most of us have heard the dictum &quot;the trend is your friend.&quot; And this is undeniably the key to success when it comes to short-term investing or trading. But it isn&#39;t easy to ensure the sustainability of a trend and profit from it.
Often, the direction of a stock&#39;s price movement reverses quickly after taking a position in it, making investors incur a short-term capital loss. So, it&#39;s important to ensure that there are enough factors -- such as sound fundamentals, positive earnings estimate revisions, etc. -- that could keep the momentum in the stock going.
Investors looking to make a profit from stocks that are currently on the move may find our &quot;Recent Price Strength&quot; screen pretty useful. This predefined screen comes handy in spotting stocks that are on an uptrend backed by strength in their fundamentals, and trading in the upper portion of their 52-week high-low range, which is usually an indicator of bullishness.
There are several stocks that passed through the screen and Vaalco Energy (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/egy#NYSE">EGY</a>) is one of them. Here are the key reasons why this stock is a solid choice for &quot;trend&quot; investing.
A solid price increase over a period of 12 weeks reflects investors&#39; continued willingness to pay more for the potential upside in a stock. EGY is quite a good fit in this regard, gaining 2% over this period.
However, it&#39;s not enough to look at the price change for around three months, as it doesn&#39;t reflect any trend reversal that might have happened in a shorter time frame. It&#39;s important for a potential winner to maintain the price trend. A price increase of 6% over the past four weeks ensures that the trend is still in place for the stock of this oil and natural gas explorer.
Moreover, EGY is currently trading at 80.1% of its 52-week High-Low Range, hinting that it can be on the verge of a breakout.
Looking at the fundamentals, the stock currently carries a Zacks Rank #2 (Buy), which means it is in the top 20% of more than the 4,000 stocks that we rank based on trends in earnings estimate revisions and EPS surprises -- the key factors that impact a stock&#39;s near-term price movements.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988.
Another factor that confirms the company&#39;s fundamental strength is its Average Broker Recommendation of #1 (Strong Buy). This indicates that the brokerage community is highly optimistic about the stock&#39;s near-term price performance.
So, the price trend in EGY may not reverse anytime soon.
In addition to EGY, there are several other stocks that currently pass through our &quot;Recent Price Strength&quot; screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.
However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past.
<a href="https://www.zacks.com/stock/news/2300585/vaalco-energy-egy-is-a-great-choice-for-trend-investors-here-s-why?cid=CS-BENZ-FT-tale_of_the_tape|recent_price_strength_screen-2300585">To read this article on Zacks.com click here.</a>

Vaalco Energy Is a Great Choice for 'Trend' Investors, Here's Why

Roth MKM analyst John White maintains VAALCO Energy (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EGY#NYSE">EGY</a>) with a Buy and raises the price target from $7.25 to $8.

Price Target

Roth MKM Maintains Buy on VAALCO Energy, Raises Price Target to $8

Highlights:
<ul>
<li>Safely and successfully drilled, completed and brought online four long lateral wells in Canada;
<ul>
<li>All wells were 2.75 mile lateral development wells;</li>
<li>Strong initial production rates of approximately 500 barrels of oil per day (&quot;BOPD&quot;) for three of the four wells, with production of approximately 350 BOPD for the fourth well, prior to the well being shut in for a regulatory required pressure build up;</li>
<li>Average cycle time for the four wells was about 65 days from rig release to first production; and</li>
</ul>
</li>
<li>Strategically targeting an appraisal well in the&nbsp;third quarter&nbsp;of 2024 in the Company&#39;s Southern acreage</li>
</ul>

VAALCO Energy Completes And Brings Online Four High-Production Wells In Canada

VAALCO Energy, Inc. (EGY) Q2 2024 Earnings Call Transcript

Vaalco Energy (EGY) has shared an announcement. VAALCO Energy, Inc. has solidified its leadership by officially appointing Lynn Willis as the Chief...

Vaalco Energy Confirms Lynn Willis as Chief Accounting Officer

Vaalco Energy (EGY) has released an update. Vaalco Energy, Inc. is set to present at the EnerCom Denver Conference on August 20th, with CEO George ...

Vaalco Energy to Present at EnerCom Denver

Analyst Chris Wheaton of Stifel Nicolaus maintained a Buy rating on Vaalco Energy (EGY – Research Report), with a price target of p744.00. Chris Wh...

Vaalco Energy: Strong Q2 Performance and Promising Future Prospects Affirm Buy Rating

In a report released today, John M. White from Roth MKM maintained a Buy rating on Vaalco Energy (EGY – Research Report), with a price target of $8...

Roth MKM Keeps Their Buy Rating on Vaalco Energy (EGY)

With the growing oil demand, pressured supply, and geopolitical instability, the oil industry is well-poised to experience robust expansion. Therefore, it could be wise to invest in top oil & gas stocks APA Corporation (APA), Obsidian Energy (OBE), and VAALCO Energy (EGY), which are trading at a discount. Read on... The oil and gas industry is experiencing strong growth amid elevated prices and strong demand. Given the industry's bright prospects, investors could consider buying fundamentally sound oil and gas stocks APA Corporation (<a href="https://stocknews.com/stock/APA/">APA</a>), Obsidian Energy Ltd. (<a href="https://stocknews.com/stock/OBE/">OBE</a>), and VAALCO Energy, Inc. (<a href="https://stocknews.com/stock/EGY/">EGY</a>), which are currently trading at a discount.
Global oil demand increased by 870 kb/d in the second quarter of 2024, and the demand is projected to rise by less than 1 mb/d in both 2024 and 2025. Also, <a href="https://www.iea.org/reports/oil-market-report-august-2024">world supply rose 230 kb/d</a> to 103.4 mb/d in July as the substantial OPEC+ increase offset losses from non-OPEC+. The <a href="https://www.eia.gov/outlooks/steo/report/global_oil.php">Brent crude oil spot price totaled $85 per barrel in July</a>, up $3/b from the average in June.
Also, with solid dealmaking activities observed in the oil and gas industry in 2023, the industry's prospects are robust. <a href="https://www.reuters.com/markets/commodities/us-oil-gas-ma-activity-jumped-57-last-year-amid-industry-consolidation-2024-08-20/">M&amp;A activities increased by 57%</a> last year, with energy companies increasing their development spending, driven by higher cash flows from profits in prior years.
Moreover, the oil and gas market is expected to grow to $9.35 trillion by 2028, exhibiting growth at a <a href="https://www.researchandmarkets.com/report/oil-gas-exploration-production#:~:text=The%20oil%20and%20gas%20market,(CAGR)%20of%206.1%25.">CAGR of 5.2%</a>, driven by rapid expansion in resource exploration, supportive government initiatives, adoption of digital technologies, and investments in oil drilling activities.
Considering the favorable market trends, let's delve into the fundamentals of the top <a href="https://stocknews.com/category/energy-oil-gas/">Energy – Oil &amp; Gas</a> stocks, beginning with the third choice.
Stock #3: APA Corporation (<a href="https://stocknews.com/stock/APA/">APA</a>)
APA explores, develops, and produces natural gas, crude oil, and natural gas liquids. The company has oil and gas operations internationally. It has exploration and appraisal activities in Suriname, and it holds interests in projects located in Uruguay and internationally.
In terms of forward non-GAAP P/E, APA is trading at 6.44x, 45.1% lower than the industry average of 11.72x. Likewise, the stock's forward EV/Sales multiple of 1.94 is 3.7% lower than the industry average of 2.01. Also, its forward Price/Sales of 1.12x is 20.1% lower than the industry average of 1.40x.
On May 22, APA's board of directors declared a regular cash dividend of $0.25 per share on the company's common shares. The dividend on common shares was paid on August 22, 2024, to stockholders of record on July 22, 2024.
APA pays an annual dividend of $1, which translates to a yield of 3.52% at the current share price. Its four-year average dividend yield is 1.83%. Moreover, the company's dividend payouts have increased at a CAGR of 115.4% over the past three years.
On April 1, APA acquired Callon Petroleum Company (<a href="https://stocknews.com/stock/CPE/">CPE</a>). The strategic acquisition bodes well with APA as Callon's assets bring scale to its Delaware position and balance its overall Permian asset base.
The acquisition is expected to bring APA's daily reported production to approximately 500,000 barrels of oil equivalent (BOE), approximately two-thirds from the Permian Basin.
APA's total revenues amounted to $2.54 billion in the second quarter that ended June 30, 2024, with a 41.6% year-over-year uptick. The company's adjusted earnings came in at $434 million and $1.17 per share, reflecting increases of 64.4% and 37.6% from the prior year's quarter, respectively. Its adjusted <a href="https://www.investopedia.com/terms/e/ebitdax.asp#:~:text=EBITDAX%20is%20an%20indicator%20of,Amortization%2C%20and%20Exploration%20Expense.%22">EBITDAX</a> of $1.58 billion indicates a growth of 29.5% year-over-year.
As of June 30, 2024, APA's total assets stood at $20.19 billion, compared to $15.24 billion as of December 31, 2023.
Street expects APA's revenue and EPS to increase 30.2% and 7.5% year-over-year to $2.46 billion and $1.24 for the fourth quarter (ending December 2024). APA's stock has declined 5.9% over the past six months to close the last trading session at $28.43.
APA's bright prospects are reflected in its <a href="https://stocknews.com/powr-ratings/">POWR Ratings</a>. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.
The stock has a B grade for Quality and Value. APA is ranked #19 among 78 stocks in the <a href="https://stocknews.com/category/energy-oil-gas/">Energy – Oil &amp; Gas</a> industry.
<a href="https://stocknews.com/stock/APA/">Click here</a> to access additional APA ratings for Sentiment, Momentum, Growth, and Stability.
Stock #2: Obsidian Energy Ltd. (<a href="https://stocknews.com/stock/OBE/">OBE</a>)
Headquartered in Calgary, Canada, OBE is engaged in the exploration, production, and development of oil and natural gas properties in Western Canada.
OBE's forward Price/Sales of 0.89x is 36.4% lower than the industry average of 1.40x. Further, the stock's forward Price/Cash Flow multiple of 1.76 is considerably lower than the industry average of 5.42. Similarly, its forward EV/EBITDA of 2.31x is 61.5% lower than the industry average of 6x.
On June 27, OBE closed its previously announced acquisition of around 1,700 boe/d of Clearwater production and 148 net sections of land in the Peace River area. The acquisition, along with other smaller acquisitions made in 2024, brings the company's holdings to over 680 net sections of land with Clearwater and Bluesky heavy oil rights.
The strategic acquisition allows OBE further upside and optionality within its Peace River operating area.
In the second quarter that ended June 30, 2024, OBE's total production increased 15.2% year-over-year to 35,773 boe/d. The company's net income was CAD 37.10 million ($27.55 million) and $0.46 per share, up 101.6% and 109.1% from the previous year's quarter. In addition, the company's free cash flow increased 20.9% year-over-year to CAD 52 million ($38.61 million).
Street expects OBE's revenue for the fiscal year (ending December 2024) to increase 13.3% year-over-year to $605.55 million. The company's EPS for the same period is expected to grow 52% year-over-year to $1.44.
OBE's stock has surged 0.7% over the past six months and 7.9% over the past year to close the last trading session at $7.07.
OBE's sound fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, translating to a Buy in our proprietary rating system.
The stock has a B grade for Value. Within the same industry, OBE is ranked #9 out of 78 stocks.
In addition to the POWR Ratings I've just highlighted, you can see OBE's ratings for Momentum, Growth, Stability, Quality, and Sentiment <a href="https://stocknews.com/stock/OBE/">here</a>.
Stock #1: VAALCO Energy, Inc. (<a href="https://stocknews.com/stock/EGY/">EGY</a>)
EGY is an independent energy company that engages in the acquisition, exploration, development, and production of crude oil, natural gas, and natural gas liquids in Gabon, Egypt, Equatorial Guinea, and Canada. It holds a 58.8% interest in Etame commercial production.
In terms of forward EV/EBIT, EGY is trading at 4.81x, 52.7% lower than the industry average of 10.18x. Similarly, the stock's forward Price/Cash Flow multiple of 2.69 is 50.3% lower than the industry average of 5.42. Also, its forward EV/Sales of 1.42x is 29.4% lower than the industry average of 2.01x.
On May 29, EGY announced the successful drilling campaign results. The company drilled, completed, and brought into production four wells in Canada. All wells were 2.75-mile lateral development wells. It expects strong initial production rates of about 500 barrels of oil per day (BOPD) for three of the four wells, with nearly 350 BOPD production for the fourth well.
On April 30, EGY acquired the Svenska Petroleum Exploration AB, an exploration and production company based in Stockholm, Sweden. Svenska's primary asset is a 27.39% non-operated working interest in the deepwater producing Baobab field in Block CI-40, offshore Cote d'Ivoire in West Africa. The net purchase price was $40.20 million, fully funded by cash on hand.
For the second quarter that ended on June 30, 2024, EGY's revenues increased 6.9% year-over-year to $116.78 million. Its income before income taxes rose 104.2% from the year-ago value to $37.45 million. The company's net income came in at $28.15 million and $0.27 per share, up 316.9% and 350% year-over-year, respectively.
In addition, the company's adjusted EBITDAX of $72.47 million indicates growth of 11% from the prior year's quarter.
Analysts expect EGY's revenue for the third quarter (ending September 2024) to increase 28.8% year-over-year to $149.79 million, and its EPS is expected to grow 242.9% year-over-year to $0.24 in the same quarter. Moreover, the company surpassed the consensus EPS estimates in three of the four trailing quarters.
The stock has soared 46.9% over the past six months and 40.5% over the past year to close the last trading session at $6.42.
EGY's promising outlook is reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.
The stock has a B grade for Sentiment, Quality, and Value. Within the Energy – Oil &amp; Gas industry, EGY is ranked #6 out of 78 stocks.
<a href="https://stocknews.com/stock/EGY/">Click here</a> to access additional ratings of EGY for Growth, Momentum, and Stability.
What To Do Next?
Discover 10 widely held stocks that our proprietary model shows have tremendous downside potential. Please make sure none of these "death trap" stocks are lurking in your portfolio:
<a href="https://report.stocknews.com/free-report/10-stocks-to-sell/?formplacement=artbotad_10sell">10 Stocks to SELL NOW! &gt;</a>

<hr />
APA shares were trading at $28.36 per share on Wednesday afternoon, down $0.07 (-0.25%). Year-to-date, APA has declined -19.06%, versus a 17.75% rise in the benchmark S&amp;P 500 index during the same period.
<hr><div style="clear:both;"></div> <h2>About the Author: Rjkumari Saxena</h2> <img src='https:/wp-content/uploads/2024/04/Rajkumari-Saxena_Image-1.jpeg' style="float:left; padding:5px;width:125px;">Rajkumari started her career as a writer but gradually shifted her focus to financial journalism, leveraging her educational background in Commerce. Fascinated by the interplay of business and economic shifts in equities, she aspires to evolve as an analyst. With a knack for simplifying complex financial concepts, her mission is to empower investors with insights that lead to profitable decisions.<a href="https://stocknews.com/authors/?author=rajkumari-saxena">More...</a>The post <a href=https://stocknews.com/news/apa-egy-obe-cpe-3-oil-gas-stocks-still-trading-at-a-discount/>3 Oil & Gas Stocks Still Trading at a Discount</a> appeared first on <a href=https://stocknews.com/>StockNews.com</a>

3 Oil & Gas Stocks Still Trading at a Discount

The growing oil demand, pressured supply, and geopolitical instability are favoring the oil and gas industry. Therefore, it could be wise to invest in top oil & gas stocks APA Corporation (APA), Obsidian Energy (OBE), and VAALCO Energy (EGY), which are trading at a discount. Read on... The oil and gas industry is experiencing strong growth amid elevated prices and strong demand. Given the industry's bright prospects, investors could consider buying fundamentally sound oil and gas stocks APA Corporation (<a href="https://stocknews.com/stock/APA/">APA</a>), Obsidian Energy Ltd. (<a href="https://stocknews.com/stock/OBE/">OBE</a>), and VAALCO Energy, Inc. (<a href="https://stocknews.com/stock/EGY/">EGY</a>), which are currently trading at a discount.
Global oil demand increased by 870 kb/d in the second quarter of 2024, and the demand is projected to rise by less than 1 mb/d in both 2024 and 2025. Also, <a href="https://www.iea.org/reports/oil-market-report-august-2024">world supply rose 230 kb/d</a> to 103.4 mb/d in July as the substantial OPEC+ increase offset losses from non-OPEC+. The <a href="https://www.eia.gov/outlooks/steo/report/global_oil.php">Brent crude oil spot price totaled $85 per barrel in July</a>, up $3/b from the average in June.
Also, with solid dealmaking activities observed in the oil and gas industry in 2023, the industry's prospects are robust. <a href="https://www.reuters.com/markets/commodities/us-oil-gas-ma-activity-jumped-57-last-year-amid-industry-consolidation-2024-08-20/">M&amp;A activities increased by 57%</a> last year, with energy companies increasing their development spending, driven by higher cash flows from profits in prior years.
Moreover, the oil and gas market is expected to grow to $9.35 trillion by 2028, exhibiting growth at a <a href="https://www.researchandmarkets.com/report/oil-gas-exploration-production#:~:text=The%20oil%20and%20gas%20market,(CAGR)%20of%206.1%25.">CAGR of 5.2%</a>, driven by rapid expansion in resource exploration, supportive government initiatives, adoption of digital technologies, and investments in oil drilling activities.
Considering the favorable market trends, let's delve into the fundamentals of the top <a href="https://stocknews.com/category/energy-oil-gas/">Energy – Oil &amp; Gas</a> stocks, beginning with the third choice.
Stock #3: APA Corporation (<a href="https://stocknews.com/stock/APA/">APA</a>)
APA explores, develops, and produces natural gas, crude oil, and natural gas liquids. The company has oil and gas operations internationally. It has exploration and appraisal activities in Suriname, and it holds interests in projects located in Uruguay and internationally.
In terms of forward non-GAAP P/E, APA is trading at 6.44x, 45.1% lower than the industry average of 11.72x. Likewise, the stock's forward EV/Sales multiple of 1.94 is 3.7% lower than the industry average of 2.01. Also, its forward Price/Sales of 1.12x is 20.1% lower than the industry average of 1.40x.
On May 22, APA's board of directors declared a regular cash dividend of $0.25 per share on the company's common shares. The dividend on common shares was paid on August 22, 2024, to stockholders of record on July 22, 2024.
APA pays an annual dividend of $1, which translates to a yield of 3.52% at the current share price. Its four-year average dividend yield is 1.83%. Moreover, the company's dividend payouts have increased at a CAGR of 115.4% over the past three years.
On April 1, APA acquired Callon Petroleum Company (<a href="https://stocknews.com/stock/CPE/">CPE</a>). The strategic acquisition bodes well with APA as Callon's assets bring scale to its Delaware position and balance its overall Permian asset base.
The acquisition is expected to bring APA's daily reported production to approximately 500,000 barrels of oil equivalent (BOE), approximately two-thirds from the Permian Basin.
APA's total revenues amounted to $2.54 billion in the second quarter that ended June 30, 2024, with a 41.6% year-over-year uptick. The company's adjusted earnings came in at $434 million and $1.17 per share, reflecting increases of 64.4% and 37.6% from the prior year's quarter, respectively. Its adjusted <a href="https://www.investopedia.com/terms/e/ebitdax.asp#:~:text=EBITDAX%20is%20an%20indicator%20of,Amortization%2C%20and%20Exploration%20Expense.%22">EBITDAX</a> of $1.58 billion indicates a growth of 29.5% year-over-year.
As of June 30, 2024, APA's total assets stood at $20.19 billion, compared to $15.24 billion as of December 31, 2023.
Street expects APA's revenue and EPS to increase 30.2% and 7.5% year-over-year to $2.46 billion and $1.24 for the fourth quarter (ending December 2024). APA's stock has declined 5.9% over the past six months to close the last trading session at $28.43.
APA's bright prospects are reflected in its <a href="https://stocknews.com/powr-ratings/">POWR Ratings</a>. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.
The stock has a B grade for Quality and Value. APA is ranked #19 among 78 stocks in the <a href="https://stocknews.com/category/energy-oil-gas/">Energy – Oil &amp; Gas</a> industry.
<a href="https://stocknews.com/stock/APA/">Click here</a> to access additional APA ratings for Sentiment, Momentum, Growth, and Stability.
Stock #2: Obsidian Energy Ltd. (<a href="https://stocknews.com/stock/OBE/">OBE</a>)
Headquartered in Calgary, Canada, OBE is engaged in the exploration, production, and development of oil and natural gas properties in Western Canada.
OBE's forward Price/Sales of 0.89x is 36.4% lower than the industry average of 1.40x. Further, the stock's forward Price/Cash Flow multiple of 1.76 is considerably lower than the industry average of 5.42. Similarly, its forward EV/EBITDA of 2.31x is 61.5% lower than the industry average of 6x.
On June 27, OBE closed its previously announced acquisition of around 1,700 boe/d of Clearwater production and 148 net sections of land in the Peace River area. The acquisition, along with other smaller acquisitions made in 2024, brings the company's holdings to over 680 net sections of land with Clearwater and Bluesky heavy oil rights.
The strategic acquisition allows OBE further upside and optionality within its Peace River operating area.
In the second quarter that ended June 30, 2024, OBE's total production increased 15.2% year-over-year to 35,773 boe/d. The company's net income was CAD 37.10 million ($27.55 million) and $0.46 per share, up 101.6% and 109.1% from the previous year's quarter. In addition, the company's free cash flow increased 20.9% year-over-year to CAD 52 million ($38.61 million).
Street expects OBE's revenue for the fiscal year (ending December 2024) to increase 13.3% year-over-year to $605.55 million. The company's EPS for the same period is expected to grow 52% year-over-year to $1.44.
OBE's stock has surged 0.7% over the past six months and 7.9% over the past year to close the last trading session at $7.07.
OBE's sound fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, translating to a Buy in our proprietary rating system.
The stock has a B grade for Value. Within the same industry, OBE is ranked #9 out of 78 stocks.
In addition to the POWR Ratings I've just highlighted, you can see OBE's ratings for Momentum, Growth, Stability, Quality, and Sentiment <a href="https://stocknews.com/stock/OBE/">here</a>.
Stock #1: VAALCO Energy, Inc. (<a href="https://stocknews.com/stock/EGY/">EGY</a>)
EGY is an independent energy company that engages in the acquisition, exploration, development, and production of crude oil, natural gas, and natural gas liquids in Gabon, Egypt, Equatorial Guinea, and Canada. It holds a 58.8% interest in Etame commercial production.
In terms of forward EV/EBIT, EGY is trading at 4.81x, 52.7% lower than the industry average of 10.18x. Similarly, the stock's forward Price/Cash Flow multiple of 2.69 is 50.3% lower than the industry average of 5.42. Also, its forward EV/Sales of 1.42x is 29.4% lower than the industry average of 2.01x.
On May 29, EGY announced the successful drilling campaign results. The company drilled, completed, and brought into production four wells in Canada. All wells were 2.75-mile lateral development wells. It expects strong initial production rates of about 500 barrels of oil per day (BOPD) for three of the four wells, with nearly 350 BOPD production for the fourth well.
On April 30, EGY acquired the Svenska Petroleum Exploration AB, an exploration and production company based in Stockholm, Sweden. Svenska's primary asset is a 27.39% non-operated working interest in the deepwater producing Baobab field in Block CI-40, offshore Cote d'Ivoire in West Africa. The net purchase price was $40.20 million, fully funded by cash on hand.
For the second quarter that ended on June 30, 2024, EGY's revenues increased 6.9% year-over-year to $116.78 million. Its income before income taxes rose 104.2% from the year-ago value to $37.45 million. The company's net income came in at $28.15 million and $0.27 per share, up 316.9% and 350% year-over-year, respectively.
In addition, the company's adjusted EBITDAX of $72.47 million indicates growth of 11% from the prior year's quarter.
Analysts expect EGY's revenue for the third quarter (ending September 2024) to increase 28.8% year-over-year to $149.79 million, and its EPS is expected to grow 242.9% year-over-year to $0.24 in the same quarter. Moreover, the company surpassed the consensus EPS estimates in three of the four trailing quarters.
The stock has soared 46.9% over the past six months and 40.5% over the past year to close the last trading session at $6.42.
EGY's promising outlook is reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.
The stock has a B grade for Sentiment, Quality, and Value. Within the Energy – Oil &amp; Gas industry, EGY is ranked #6 out of 78 stocks.
<a href="https://stocknews.com/stock/EGY/">Click here</a> to access additional ratings of EGY for Growth, Momentum, and Stability.
What To Do Next?
Discover 10 widely held stocks that our proprietary model shows have tremendous downside potential. Please make sure none of these "death trap" stocks are lurking in your portfolio:
<a href="https://report.stocknews.com/free-report/10-stocks-to-sell/?formplacement=artbotad_10sell">10 Stocks to SELL NOW! &gt;</a>

<hr />
APA shares were trading at $28.36 per share on Wednesday afternoon, down $0.07 (-0.25%). Year-to-date, APA has declined -19.06%, versus a 17.75% rise in the benchmark S&amp;P 500 index during the same period.
<hr><div style="clear:both;"></div> <h2>About the Author: Rjkumari Saxena</h2> <img src='https:/wp-content/uploads/2024/04/Rajkumari-Saxena_Image-1.jpeg' style="float:left; padding:5px;width:125px;">Rajkumari started her career as a writer but gradually shifted her focus to financial journalism, leveraging her educational background in Commerce. Fascinated by the interplay of business and economic shifts in equities, she aspires to evolve as an analyst. With a knack for simplifying complex financial concepts, her mission is to empower investors with insights that lead to profitable decisions.<a href="https://stocknews.com/authors/?author=rajkumari-saxena">More...</a>The post <a href=https://stocknews.com/news/apa-egy-obe-cpe-3-oil-gas-stocks-still-trading-at-a-discount/>3 Oil & Gas Stocks Still Trading at a Discount</a> appeared first on <a href=https://stocknews.com/>StockNews.com</a>

BofA latest to cut oil price view on weak demand, limiting OPEC's ability to boost output

With the Federal Reserve expected to lower interest rates and a cautiously optimistic outlook for global oil demand, it could be wise to consider investing in quality small-cap energy stocks VAALCO Energy (EGY), Obsidian Energy (OBE), Adams Resources & Energy (AE), each with upside potential exceeding 60%. Read more… The energy market has faced volatility recently, driven by concerns over global economic growth and fluctuating oil prices. However, with the potential for interest rate cuts by the Federal Reserve, now might be an opportune time to consider investing in small-cap energy stocks like VAALCO Energy, Inc. (<a href="https://stocknews.com/stock/EGY/">EGY</a>), Obsidian Energy Ltd. (<a href="https://stocknews.com/stock/OBE/">OBE</a>), Adams Resources &amp; Energy, Inc. (<a href="https://stocknews.com/stock/AE/">AE</a>), with big upside potential.
Oil prices have been under pressure due to higher supply from OPEC+ and fears of slowing demand, particularly from China. However, short-term market dynamics are creating opportunities for investors in the energy space. For example, <a href="https://www.reuters.com/markets/commodities/oil-prices-inch-up-fed-rate-cut-outlook-2024-09-16/">oil prices rose over 1%</a> recently, driven by supply disruptions caused by Hurricane Francine in the U.S. Gulf of Mexico.
Brent crude futures rose to $72.53 per barrel, while U.S. crude reached $69.77 per barrel. While short-term gains reflect the impact of the hurricane, the broader market remains focused on the upcoming Federal Reserve rate decision, which will likely set the tone for economic activity in the months ahead.
Lower interest rates have historically boosted economic activity and, in turn, increased demand for oil. While a 50-bps rate cut could signal economic weakness, it could also catalyze growth in small-cap energy stocks, which tend to outperform in low-rate environments. Moreover, the U.S. Energy Information Administration (EIA) projects global oil demand will hit a new record of <a href="https://www.reuters.com/business/energy/us-eia-lifts-oil-demand-forecast-says-prices-will-recover-above-80bbl-2024-09-10/">103.1 million barrels per day</a> in 2024.
With that in mind, let's analyze the fundamental aspects of the featured <a href="https://stocknews.com/category/energy-oil-gas/">Energy – Oil &amp; Gas</a> stocks, starting with the third choice.
Stock #3: Adams Resources &amp; Energy, Inc. (<a href="https://stocknews.com/stock/AE/">AE</a>)
With a market cap of $61.93 million, AE is engaged in marketing, transporting, terminalling, and storing various crude oil and natural gas basins in the United States. It operates through four segments: Crude Oil Marketing; Transportation; Pipeline and Storage; and Logistics and Repurposing.
On August 7, the company's Board of Directors declared a dividend of $0.24 per common share for the second quarter, payable to its shareholders on September 27, 2024. AE pays an annual dividend of $0.96, which translates to a yield of 3.98% at the current share price. Moreover, its four-year average dividend yield is 3.20%.
In terms of trailing-12-month, AE's asset turnover ratio of 8.03x is considerably higher than the industry average of 0.49x.
AE's total revenues increased 15% year-over-year to $718.49 million for the second quarter that ended June 30, 2024. Its <a href="https://www.investopedia.com/terms/a/adjusted-ebitda.asp">adjusted EBITDA</a> stood at $4.20 million, while its cash inflow from operating activities amounted to $8.32 million compared to an outflow of $27.32 million in the prior-year quarter. At the end of the period, the company's cash and cash equivalents, including restricted cash, improved by 179.5% from its year-ago value to $49.64 million.
Street expects AE's EPS and revenue for the fourth quarter (ending December 2024) to be $0.03 and $707.60 million, respectively. The company has topped the consensus revenue estimate in each of the trailing four quarters, which is promising.
Moreover, over the past three years, its revenue and levered FCF have grown at impressive CAGRs of 28.9% and 25.8%, respectively.
Over the past month, the stock has gained 7.2%, closing the last trading session at $24.12. Its 12-month price target of $38.75 reflects a <a href="https://www.tipranks.com/stocks/ae/forecast">60.7% potential upside</a>.
AE's strong fundamentals are reflected in its <a href="https://stocknews.com/powr-ratings/">POWR Ratings</a>. It has an overall rating of B, which equates to Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
It also has a B grade for Value. Among the 80 stocks in the <a href="https://stocknews.com/category/energy-oil-gas/">Energy - Oil &amp; Gas</a> industry, it is ranked #12. <a href="https://stocknews.com/stock/AE/">Click here</a> to see the other AE ratings for Growth, Momentum, Stability, Sentiment, and Quality.
Stock #2: Obsidian Energy Ltd. (<a href="https://stocknews.com/stock/OBE/">OBE</a>)
OBE is a Canada-based exploration and production company focused on developing oil and natural gas properties in Western Canada's Sedimentary Basin. The company operates a portfolio of assets, producing approximately 35,700 barrels of oil equivalent (boe) per day. Its operations include the exploration, development, and management of oil and natural gas interests and related production infrastructure. It has a market cap of $441.68 million.
On June 26, the company completed its acquisition of 1,700 boe/d of Clearwater oil production and 148 net sections of land in the Peace River area for approximately $80.5 million. The deal, effective May 1, 2024, expands the company's holdings and adds 200 potential drilling locations.
OBE's CEO, Stephen Loukas, stated that the acquisition aligns with their 2024-2026 growth plan and enhances development opportunities, especially in their successful Clearwater Dawson area.
OBE's trailing-12-month EBITDA margin of 61.11% is 72.9% higher than the 35.34% industry average. Similarly, its 63.60% trailing-12-month gross profit margin is 41.5% above the 44.94% industry average.
For the fiscal second quarter that ended June 30, 2024, OBE reported a 25.5% year-over-year increase in production revenues of $208.40 million. Its funds flow from operations grew by 31.8% from the prior year's quarter to $115.20 million, while its FFO per share stood at $1.44, up 39.8% year-over-year.
The company's net income amounted to $37.10 million and $0.46 per share, reflecting an improvement of 101.6% and 109.1% from the year-ago quarter, respectively. Moreover, its cash flow from operating activities increased by 16.1% year-over-year to $77.90 million.
The consensus EPS estimate of $1.44 for the current year (ending December 2024) indicates a 51.9% improvement year-over-year. The consensus revenue estimate of $625.21 million for the same period reflects a 16.9% increase from the prior year.
Over the past three years, its revenue and EBITDA have grown at respective CAGRs of 26.1% and 38.2%. Likewise, its tang book value has increased at a 35.8% CAGR over the same time frame.
The stock has lost 13.9% over the past month to close the last trading session at $5.80. However, its 12-month price target of $11.77 indicates a <a href="https://www.tipranks.com/stocks/obe/forecast">102.9% potential upside</a>.
OBE's POWR Ratings reflect this promising outlook. The stock has an overall B rating, translating to Buy in our proprietary rating system.
It has a B grade for Value and Sentiment. Within the same industry, it is ranked #6. To see additional POWR Ratings for OBE for Growth, Momentum, Stability, and Quality, <a href="https://stocknews.com/stock/OBE/">click here</a>.
Stock #1: VAALCO Energy, Inc. (<a href="https://stocknews.com/stock/EGY/">EGY</a>)
With a $579.92 million market cap, EGY acquires, explores, develops, and produces crude oil, natural gas, and natural gas liquids in Gabon, Egypt, Equatorial Guinea, and Canada.
On August 6, demonstrating its commitment to returning value to shareholders, the company declared a quarterly dividend of $0.0625 per share ($0.25 annualized), which is payable on September 20, 2024, to stockholders of record at the close of business on August 23, 2024. EGY's annual dividend translates to a yield of 4.47% at the current share price, while its four-year average dividend yield is 2.16%.
In April, the company completed the all-cash acquisition of Svenska Petroleum Exploration AB for $40.2 million, enhancing its production capacity in the Baobab field, now producing over 5,000 barrels of oil equivalent per day (99% oil).
This acquisition strategically expands EGY's presence in West Africa, particularly in Cote d'Ivoire, an investment-friendly country with significant upside potential. Further, the move bolsters EGY's growth prospects and regional operational footprint.
The stock's trailing-12-month gross profit and EBITDA margins of 64.19% and 58.43% are 42.8% and 65.3% higher than the industry averages of 44.94% and 35.34%, respectively. Likewise, its 32.31% trailing-12-month levered FCF margin compares favorably to the 6.50% industry average.
During the second quarter (ended June 30, 2024), EGY's revenue increased 6.9% year-over-year to $116.78 million. Its adjusted net income amounted to $22.58 million and $0.22 per share, reflecting a year-over-year improvement of 70.2% and 83.3%, respectively. In addition, its adjusted EBITDAX stood at $72.47 million, up 10.9% year-over-year.
Analysts expect EGY's revenue to increase 28.8% year-over-year to $149.79 million for the current quarter (ending September 2024), while its EPS is expected to grow considerably from the prior year to $0.18 in the same period. Also, the company has surpassed the consensus EPS estimates in three of the trailing four quarters, which is impressive.
Moreover, the stock's revenue and net income have grown at impressive CAGRs of 60.1% and 63.2% over the past three years, respectively. Similarly, its EPS has grown at a 33.8% CAGR over the same period.
EGY's shares have gained 31.2% over the past year and 24.5% year-to-date to close the last trading session at $5.59. Its 12-month price target of $9.40 reflects a <a href="https://www.tipranks.com/stocks/egy/forecast">68.2% potential upside</a>.
It's no surprise that EGY has an overall rating of B, which equates to Buy in our proprietary rating system. It has a B grade for Value, Sentiment, and Quality. Out of 80 stocks in the same industry, it is ranked #5.
In addition to the POWR Ratings we've stated above, we also have EGY's ratings for Growth, Momentum, and Stability. Get all EGY ratings <a href="https://stocknews.com/stock/EGY/">here</a>.
What To Do Next?
Get your hands on this special report with 3 low priced companies with tremendous upside potential even in today's volatile markets:
<a href="https://report.stocknews.com/free-report/3stocks/?formplacement=artbotad_3s">3 Stocks to DOUBLE This Year &gt;</a>

<hr />
EGY shares were trading at $5.71 per share on Monday afternoon, up $0.12 (+2.15%). Year-to-date, EGY has gained 31.72%, versus a 19.11% rise in the benchmark S&amp;P 500 index during the same period.
<hr><div style="clear:both;"></div> <h2>About the Author: Shweta Kumari</h2> <img src='https:/wp-content/uploads/2022/03/Shweta-Kumari_Image-2.jpg' style="float:left; padding:5px;width:125px;">Shweta's profound interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help retail investors make educated investment decisions.<a href="https://stocknews.com/authors/?author=shweta-kumari">More...</a>The post <a href=https://stocknews.com/news/egy-ae-obe-3-small-cap-energy-stocks-with-big-upside-potential/>3 Small-Cap Energy Stocks With Big Upside Potential</a> appeared first on <a href=https://stocknews.com/>StockNews.com</a>

3 Small-Cap Energy Stocks With Big Upside Potential

BATL

BOIL

DRIP

EOSE

GUSH

HNRG

INDO

KLXE

KOLD

METC

SGML

USOI

VTLE

Commodities

Press Releases

The 29th Annual EnerCom Denver - The Energy Investment Conference to Host The Energy Transition and Emerging Technology Session Featuring Start-Up Energy and Technology Companies

VAALCO Energy, Inc. Provides Positive Additional Information Regarding Its Acquisition Of Svenska

Presentation Times and Schedule for Participating Companies Now Posted on the Conference Website for 29th Annual EnerCom Denver - The Energy Investment Conference

VAALCO Announces Timing of Second Quarter 2024 Earnings Release and Conference Call

VAALCO Announces Posting of Interview With CEO George Maxwell on Its Web Site

Investor One-on-One Meeting Requests Open for 29th Annual EnerCom Denver - The Energy Investment Conference, to be held August 18-21, 2024 in Denver, Colorado

VAALCO Energy, Inc. Declares Third Quarter 2024 Dividend

VAALCO Energy, Inc. Announces Second Quarter 2024 Results

EnerCom's 29th Annual Energy Investment Conference is Set to be Held August 18-21, 2024 in Denver, Colorado

VAALCO Energy, Inc. Announces Participation in EnerCom Denver Conference

AMPY

CIVI

DNOW

GRNT

LITSF

NCSM

OKLO

PARXF

RECAF

RNGR

SERV

TSX:AOI

TSX:BTE

TSX:CFW

TSX:GTE

TSX:HME

TSX:KEL

TSX:NVA

TSX:PEI

TSX:PNE

TSX:PSD

TSX:PSI

TSX:RNGR

TSX:TAL

TSX:TNZ

TSXV:HME

TSXV:LCX

TSXV:PEI

TSXV:TAL

ZPHRF

Amplify Energy

Berry Corp

Crescent Energy Company Class A Common Stock

Crescent Energy

Dorchester Minerals, L.P. - Common Units Representing Limited Partnership Interests

Get Our Top Trade Ideas Delivered Daily - 65% Off Now

Get Our Top Trade Ideas Delivered Daily - 65% Off Now

Comments

VAALCO Energy

VAALCO Energy (EGY) Forecast

VAALCO Energy (NYSE:EGY) Stock, Quote.Headers.trade-ideas