August 1, 2019
Concho Resources stock plunged on Thursday following the revelation that the firm is writing down its asset values and posted disappointing Q2 numbers.
Barron’s noted the day’s results and guidance with an article titled, “Energy Stocks Are Falling. Blame Concho Resources and the U.S. Dollar,” in which author Nicholas Jasinski said the earnings report “sent its stock down by more than 24% on Thursday,” not helping the overall oil and gas valuations.
While the dollar soared to its highest level against a basket of foreign currencies since 2017 on Thursday morning,the energy sector was badly hurt in trading, with Chesapeake ending the day down nearly 9%, Pioneer Natural Resources down over 7% Devon down nearly 7% and Parseley down more than 8%, and about Concho…
“The U.S. oil and natural gas explorer and developer wrote down the value of its assets in the Permian Basin by almost $900 million.
“That caused its second-quarter earnings to swing to a loss of 48 cents per share, while Wall Street had expected a profit of $1.12.
“Even after adjusting for the impairment charge, lower energy prices left Concho with its lowest quarterly EPS since 2017. The result was down 44% from a year earlier and again fell short of analysts’ prior estimates,” Barron’s noted.