Shares of integrated energy company, EQT Corporation EQT touched a 52-week low of $56.93 per share on Nov 30, to finally close a tad higher at $57.22. Volume was also upsized with about 1.5 million shares changing hands.
What Led to the Share Price Decline?
This drop in price continued the recent downtrend for EQT Corp. amid volatility in the energy segment and its existing commodity price exposure. The company lost about 13.4% over the past one month and is down nearly 24.4% year to date.
From a peak of about $13.50 per million barrels per unit in 2008 to around $2.2 now – sinking in between to the 10-year low of under $2 in 2012 – the plummeting value of natural gas represents a decline of around 80% over 7 years.
In the absence of major production cuts, we do not expect much upside in gas prices in the near term. Things were made worse by apprehensions of soft heating demand with forecasts of higher temperatures across certain regions of the U.S. in the short term.
Finally, the company incurred a loss of 33 cents per share in the recently reported third quarter. While the Zacks Consensus Estimate was a loss of only 22 cents, the company had earned 51 cents a share in the year-earlier quarter. Quarterly total revenue of $577 million was also down year over year from $579 million. Going forward, the company expects a loss in the average differential to the NYMEX natural gas price of $0.30–$0.40 per Mcf for the full year as well as fourth-quarter 2015.
Currently, EQT Corp carries a Zacks Rank #4 (Sell), implying that it will underperform the broader U.S. equity market over the next one to three months.
Stocks That Warrant a Look
Some better-ranked players in the energy sector are Energy Transfer Equity, L.P. ETE, Murphy USA Inc. MUSA and Boardwalk Pipeline Partners, LP BWP. Each of these stocks sports a Zacks Rank #1 (Strong Buy).
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