EOG Resources Inc (NYSE:EOG) is in the spotlight today after William Featherston of UBS upgraded the E&P to ‘Buy’ from ‘Neutral’, with the analyst commenting that the sector weakness in recent weeks is an opportunity for long term investors to buy quality at attractive prices. In addition to upgrading the stock, Featherston also raised his target price to $109 from the previous $105.
Like that of other E&P’s, EOG Resources Inc (NYSE:EOG) shares have retraced due to lower WTI prices, which fell from the mid-$50’s to around $49 per barrel today. The price of crude has fallen in the previous sessions due to concern that oil inventories around the world are still high and that there is a chance that OPEC might not extend its production cuts past June. Due to recent supportive OPEC comments and Wednesday’s strong EIA report, however, sentiment in WTI has improved a bit and many traders think the probability of a cut extension is high.
Given its low production costs, quality assets, and strong balance sheet, EOG Resources Inc (NYSE:EOG) is in a great position to weather any moderate WTI price volatility and today’s analyst upgrade acknowledges EOG Resources Inc (NYSE:EOG)’s strengths.
What Does The Smart Money Sentiment Say?
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According to our data, the smart money sentiment indicator for EOG Resources Inc (NYSE:EOG) has remained stable. Of the 742 elite funds we track, 48 funds owned $1.44 billion of EOG Resources Inc (NYSE:EOG) and accounted for 2.50% of the float on December 31, versus 51 funds and $1.28 billion respectively on September 30. Daniel S. Och‘s Oz Management more than doubled its holdings in EOG in the fourth quarter to 3.3 million shares.
What’s Next?
Although crude prices have been soft of late, Wall Street still loves EOG Resources Inc (NYSE:EOG) due to its high quality acreage and strong financial profile. For those of you interested, check out this interesting article about the countries that produce the most oil.
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