Energy Weekly Notes: BP, HAL, STP, FSLR, XOM & SLB

October 21st, 2011 by Trefis Team
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It was an eventful week in the energy sector as the market gears up for third quarter earnings. Energy stocks were volatile throughout the week as oil prices fluctuated on mixed economic indicators and the death of Libyan dictator Muammar Gaddafi. Solar stocks continued their slide, and one U.S.-based solar firm has asked the U.S. government to impose taxes on the products of Chinese solar companies. [1] The complaint alleges that the Chinese government illegally subsidizes these firms, allowing them to undercut prices.

Below is an overview of events in the sector this week:

BP Rises on Good News Ahead of Earnings:

BP (NYSE:BP) saw its share price cross the $40 mark yesterday, after it was trading at $38 a week ago. The company was at the receiving end of some good news over the past few days as the U.S. government agreed to allow BP to bid for new drilling leases in the Gulf of Mexico and Anadarko Petroleum (NYSE:APC) agreed to pay $4 billion to cover expenses relating to the Gulf of Mexico oil spill incident.

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Halliburton’s Fair Value Revised to $54, Results Buoyed by North American Demand:

Halliburton (NYSE:HAL) announced its third quarter results yesterday, posting strong growth in North America and Latin America as demand for oilfield services continued to grow despite lower oil prices. The shale gas boom, which has resulted in strong demand for Halliburton’s expertise in unconventional resources, has helped the company grow its revenues from North America by 13% sequentially.

Suntech Can’t Shake Cloud Hanging Over Solar:

Suntech Power‘s (NYSE:STP) stock continued its slide last week despite the company expressing hope that the U.S. market for solar panels would more than double in 2011. [1] Shares of solar PV manufacturers have come under pressure as European markets continue to suffer because of the turmoil in the region. The negative sentiments were intensified on Monday as competitor Canadian Solar cut its margins forecast for its Q3 results.

Schlumberger Earnings Preview: What We’re Watching:

The world’s largest oilfield services provider Schlumberger (NYSE:SLB) will announced its Q3 results on the 21st of October. Markets eagerly await earnings to gauge the actual performance of the company in a quarter that saw its stock fall by almost 30% since share price peaked at $94.70 in July this year.

First Solar Continues Fall as Trade War Boils in Industry:

First Solar (NASDAR:FSLR) shares fell from their $56 closing price last week to trade at $52 this Thursday. The worsening view for the sector was reflected in Goldman Sachs cutting its 6 month target price for the stock from $150 to $90. [1] The cut in estimates comes on the back of declining sales and lower module prices as a H2 recovery became an increasingly distant possibility.

Exxon Mobil: Oil Major Stable as Competitor Beats Q3 Estimates:

Exxon Mobil (NYSE:XOM) saw a stable week as its stock traded around the $78 level throughout while ,our pre-earnings price estimate for the company remains stable at $93 which implies a 18% premium over its current market price. The industry received positive news as independent crude oil and natural gas exploration and production firm Nobel Energy posted earnings that beat market estimates.

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Notes:
  1. Solar manufacturer presses Obama administration to investigate China, The Hill, Oct 2011 [↩]