4 Oil Stocks Not Out of the Woods Just Yet

ConocoPhillips (COP), Chesapeake Energy Corporation (CHK), Anadarko Petroleum Corporation (APC), and Devon Energy Corp (DVN) have had years they'd rather forget

Dec 10, 2015 at 1:59 PM
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While energy stocks are leading the market higher today, the sector has been bruised and battered in 2015 amid tanking crude prices. For example, of the 90 oil stocks we follow at Schaeffer's, just 11 are sitting above their 80-day moving averages. What's more, the typical year-to-date return within this group is negative 40%.

Given this dismal price action, bearish sentiment has been on the upswing. The percentage of analyst buys has fallen to 50% from 59% over the past year. Plus, short interest on these energy stocks has jumped 55.1%, on average, in the last 12 months. Below, we'll take a look at several specific oil companies, how they've fared on the charts, and what Wall Street is expecting next.

Large-cap ConocoPhillips (NYSE:COP) is helping to lead today's energy rally, up 2.9% at $49.89, after the company announced its 2016 operating plan that includes 25% lower capital spending. From a longer-term perspective, though, the stock is sitting in a nearly 28% year-to-date hole after a failed test of the $55-$57 region. Negative sentiment has swollen accordingly. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), COP has amassed a 10-day put/call volume ratio of 1.42 -- in the 87th percentile of its 12-month range. Likewise, the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.01 outstrips seven-tenths of all readings from the past year.

Chesapeake Energy Corporation (NYSE:CHK) is seeing a rare day in the sun, up 2.2% at $4.57, but has shed more than three-quarters of its value in 2015. Short sellers don't see much relief in sight. In fact, about two-fifths of the stock's float is sold short, representing over two weeks of trading activity, at typical volumes. Also on the bearish bandwagon are analysts, who have doled out 17 "hold" or worse opinions, versus two "strong buy" endorsements.

Anadarko Petroleum Corporation (NYSE:APC), meanwhile, is fresh off a five-year low of $49.89, last seen at $50.71. This month alone, the shares have retreated 15%. Unlike the two aforementioned stocks, though, this one has plenty of fans across the Street. An astounding 80% of analysts rate APC a "buy" or better, for example. Also, the equity's 50-day ISE/CBOE/PHLX call/put volume ratio registers at 6.77, or 5 percentage points from a 52-week peak. Should these bullish holdouts start heading to the exits, the stock could run into a powerful headwind.

Finally, Devon Energy Corp (NYSE:DVN) has popped 1.8% at $35.94, but has nonetheless had a brutal December, losing nearly 22% of its value. Earlier this week, in fact, the shares touched an 11-year low of $33.52. Option traders are betting on extended losses for DVN. The stock's 10-day ISE/CBOE/PHLX put/call volume ratio of 1.15 ranks in the 86th percentile of its annual range, while its SOIR of 1.11 sits above 90% of all such readings recorded in the past year.
 

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