Sluggish Times For ConocoPhillips Stock?

by Trefis Team
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ConocoPhillips
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After reaching the highs of $74/bbl, the WTI benchmark has observed a correction in recent months driven by easing of production curbs by the OPEC and an uncertain demand environment due to the pandemic. Per the U.S. Energy Information Administration’s STEO (short-term energy outlook), the WTI benchmark is likely to trend downward from $65/bbl in 2021 to $62/bbl in 2022. Thus, the shares of upstream oil companies including ConocoPhillips (NYSE: COP) are likely to observe a low upside in the near-term. Considering the trends in stock price data, ConocoPhillips stock is likely to move 0.9% in the next one-month (twenty-one trading days) period after experiencing -0.4% contraction in the past week (five trading days).

But how would these numbers change if you are interested in holding ConocoPhillips stock for a shorter or a longer time period? You can test the answer and many other combinations on the Trefis Machine Learning Engine to test ConocoPhillips stock chances of a rise after a fall. You can test the chance of recovery over different time intervals of a quarter, month, or even just one day!

MACHINE LEARNING ENGINE – try it yourself:

IF COP stock moved by -5% over five trading days, THEN over the next twenty-one trading days, COP stock moves an average of 2.1 percent, with a 56.7% probability of a positive return over this period.

Also, given a -5% movement for the stock over five trading days, it has historically witnessed an excess return of 1.2% compared to the S&P500 over the next 21 trading days, with a 49.2% percent probability of a positive excess return.

Some Fun Scenarios, FAQs & Making Sense of ConocoPhillips Stock Movements:

Question 1: Is the average return for ConocoPhillips stock higher after a drop?

Answer:

Consider two situations,

Case 1: ConocoPhillips stock drops by -5% or more in a week

Case 2: ConocoPhillips stock rises by 5% or more in a week

Is the average return for ConocoPhillips stock higher over the subsequent month after Case 1 or Case 2?

COP stock fares better after Case 2, with an average return of 2.1% over the next month (21 trading days) under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an average return of 2.5% for Case 2.

In comparison, the S&P 500 has an average return of 3.1% over the next 21 trading days under Case 1, and an average return of just 0.5% for Case 2 as detailed in our dashboard that details the average return for the S&P 500 after a fall or rise.

Try the Trefis machine learning engine above to see for yourself how ConocoPhillips stock is likely to behave after any specific gain or loss over a period.

Question 2: Does patience pay?

Answer:

If you buy and hold ConocoPhillips stock, the expectation is over time the near-term fluctuations will cancel out, and the long-term positive trend will favor you – at least if the company is otherwise strong.

Overall, according to data and Trefis machine learning engine’s calculations, patience absolutely pays for most stocks!

For COP stock, the returns over the next N days after a -5% change over the last five trading days is detailed in the table below, along with the returns for the S&P500:

Question 3: What about the average return after a rise if you wait for a while?

Answer:

The average return after a rise is understandably lower than after a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks – although COP stock appears to be an exception to this general observation.

COP’s returns over the next N days after a 5% change over the last five trading days is detailed in the table below, along with the returns for the S&P500:

It’s pretty powerful to test the trend for yourself for ConocoPhillips stock by changing the inputs in the charts above.

While ConocoPhillips stock is likely to trend in-line with broader markets, it is helpful to see how its peers stack up. ConocoPhillips Stock Comparison With Peers summarizes how COP compares against peers on metrics that matter. You can find more such useful comparisons on Peer Comparisons.

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