More Losses Could Be In Store for This Oil Stock

A price-target cut from Credit Suisse to $16 from $17 in the wake of the company's fourth-quarter earnings report has Range Resources Corp. (NYSE:RRC) stock slipping today. The energy shares are now now trading down 5% at $10.46. 

This negative price action echoes the stock's longer-term trend, with RRC shedding over 50% from its mid-October high at $18.60 to its 14-year low of $9.22 on Jan. 2. And while RRC has attempted to rally off this early 2019 low, pressure from the $11-$12 level has emerged. What's more, during this recent rebound, the equity ran up to a technical signal that could suggest even further downside the charts, if past is precedent.

Specifically, the security just came within one standard deviation of its 60-day moving average. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, RRC has tested resistance at this trendline six other times in the past couple years, which resulted in a one-month loss of 10.6%. A similar move would put the equity at $9.35 -- within striking distance of January's lows. 

Among the brokerage bunch, seven analysts still see RRC as a "strong buy." However 10 have doled out a tepid "hold," and three have issued a "sell" or worse. The lofty consensus 12-month price target of $16.26 is a 56% premium to the stock's current perch. This leaves the door open for more bear notes, which could create stiffer headwinds.

Short sellers are in control of their pessimistic positions. Short interest edged up 3.2% in the last two reporting periods, and the 46.68 million shares sold short represents nearly 20% of Range Resources total available float.