Stifel’s Michael Scialla and Daniel Guffey warn investors not to chase the biggest gainers among the exploration & production stocks, including Denbury Resources (DNR) and Whiting Petroleum (WLL), and instead stick with more stable fare such as Anadarko Petroleum (APC), Rice Energy (RICE), and Continental Resources (CLR). They explain:
Matthew Brow/Associated Press
Our peer group is up an average of 46% over the past 4 weeks in response to a 30% rebound in the 12-month strip NYMEX oil price. Some of the largest gainers include Hold and Sell rated stocks that we would not chase such asDenbury Resources (Sell, +138%), Halcon Resources (HK) (Sell, +147%), Jones Energy (JONE) (Hold, +166%), Rex Energy (REXX) (Sell, +60%), Sanchez Energy (SN) (Hold, +93%), Ultra Petroleum (UPL) (Sell, +61%), andWhiting Petroleum (Hold, +103%), which have outperformed the E&P Index (+32%) over the same time period. Balance sheets and/or well level returns remain challenged for these companies despite improved oil prices. While we believe oil markets should re-balance over the next 12 to 15 months, the recent recovery to $40 could reverse during 2Q16 as bloated inventories continue to rise, new volumes from Iran pressure an oversupplied market, and a highly anticipated decline in non-OPEC supply (especially in the U.S.), is not as steep as expected. The risk of an oil price retracement, which would significantly pressure the recent out-performers, outweighs the upside in these stocks, in our view. However, we are raising our target prices on Buy ratedAnadarko Petroleum ($54 from $48), Concho Resources (CXO) ($120 from $109), Matador Resources (MTDR) ($22 from $21),Noble Energy (NBL) ($40 from $34), SM Energy (SM) ($22 from $15), Rice Energy ($14 from $12), Pioneer Natural Resources (PXD) ($155 from $135),Continental Resources ($32 from $28), and Parsley Energy (PE) ($24 from $23). We believe our Buy-rated stocks are better positioned to weather challenging oil markets.
Top New Companies To Invest In 2016: Synacor, Inc.(SYNC)
Synacor, Inc. provides startpages and homescreens, video solutions, identity management services, and various cloud-based services for a range of devices to cable, satellite, telecom, and consumer electronics companies in the United States and Internationally. The companys technology allows customers to package a range of personalized, online content, and cloud-based services with their high-speed Internet, communications, television and other offerings. It creates, designs, and develops multi-device startpages, such as personalized contents to engage the consumers of Internet and communications providers, and device manufacturers in its media and programming library; offers digital advertising services through video, image, and text advertisements; and provides streaming video services to find TV shows, movies, and short-form videos from various genres at one place. The company also offers cloud ID products, which are ident ity management platforms for access controlling, ID usage auditing, and fraud prevention; hosting and management services for Web-based email products; and migration services to migrate from other email hosts to its email products. In addition, it provides free-to-subscriber contents and services; and paid content and premium services. The company was formerly known as CKMP, Inc. and changed its name to Synacor, Inc. in July 2001. Synacor, Inc. was founded in 1998 and is headquartered in Buffalo, New York
- [By Monica Gerson]
Synacor Inc (NASDAQ: SYNC) is projected to post a quarterly loss at $0.03 per share on revenue of $30.00 million.
VAALCO Energy, Inc. (NYSE: EGY) is expected to post a quarterly loss at $0.11 per share on revenue of $18.59 million.
Top New Companies To Invest In 2016: Polo Ralph Lauren Corporation(RL)
Ralph Lauren Corporation, together with its subsidiaries, engages in the design, marketing, and distribution of lifestyle products. The company offers men?s, women?s, and children?s clothing; and accessories comprising footwear, eyewear, watches, jewelry, hats, and belts, as well as leather goods, including handbags and luggage. It also provides products for homes, including bedding and bath products, furniture, fabric and wallpaper, paint, tabletop, and giftware; and fragrance products for women men. In addition, the company licenses its products, such as men?s sportswear, men?s tailored clothing, men?s underwear and sleepwear, eyewear, fragrances, cosmetics, and color and skin care products. It offers its products under the Polo by Ralph Lauren, Ralph Lauren Purple Label, Ralph Lauren Women?s Collection, Black Label, Blue Label, Lauren by Ralph Lauren, RRL, RLX, Rugby, Ralph Lauren Childrenswear, American Living, Chaps, and Club Monaco brand names. Ralph Lauren sells its products to department stores, specialty stores, and golf and pro shops; full-price retail stores, factory retail stores, and concessions-based shop-within-shops; and online through RalphLauren.com and Rugby.com. As of April 3, 2010, it operated 179 full-price retail stores and 171 factory stores worldwide, as well as 281 concessions-based shop-within-shops and 2 e-commerce Websites. The company was formerly known as Polo Ralph Lauren Corporation and changed its name to Ralph Lauren Corporation in August 2011. Ralph Lauren Corporation was founded in 1967 and is based in New York, New York.
- [By Ben Levisohn]
We looked at the speculation that International Paper (IP) could be a takeover target, and the progress made at Ralph Lauren (RL), and the slowing same-store sales at Shake Shack (SHAK).
Top Rising Companies To Buy Right Now: Alon USA Partners, LP(ALDW)
Alon USA Partners, LP refines and markets petroleum products in the United States. The company owns and operates a crude oil refinery in Big Spring, Texas with crude oil throughput capacity of 73,000 barrels per day. It refines oil into petroleum products, including gasoline, diesel, jet fuel, petrochemicals, petrochemical feed stocks, asphalts, and other petroleum products. The company sells its products through its wholesale distribution network to retail convenience stores and other third-party distributors primarily in Central and West Texas, Oklahoma, New Mexico, and Arizona. Alon USA Partners GP, LLC serves as a general partner of the company. The company was founded in 2012 and is based in Dallas, Texas. Alon USA Partners, LP is a subsidiary of Alon USA Energy, Inc.
- [By Tom Dorsey]
Over a several day period, I submitted questions and Mr. Eisman, President, Chief Executive Officer and Director of Alon USA Energy Inc. (ALJ) and the parent company of Alon USA Partners LP Inc. (ALDW) responded. He provided some key insights to some challenges the company faces, where the company is going, and the opportunities available in the future. This insight should provide investors with additional information to understand the value of the company and the opportunity as an investor in the company.