- Pioneer Natural Resources (PXD -14.8%) plunges to 52-week lows in early trading despite its Q2 earnings beat, as analysts cite disappointing production guidance and the increasing amount of natural gas it is producing relative to oil.
- Jefferies sees the report as negative: FY 2017 production growth was reduced to the low end of previous guidance due to Q2 drilling delays resulting in the deferral of 30 Permian wells into 2018, and the ratio of gas vs. oil is rising rapidly with a significant cut in projected oil growth for 2017 (17%-18% from 24%-28%).
- Bloomberg's Liam Denning calculates PXD's new guidance implies a drop of nine percentage points in its projected growth of oil production in 2017, taking it below the company's long-term plan; also, at 12.5x EBITDA, PXD shares trade toward the top of an already relatively expensive group of Permian producers.
- Now read: Investors Starting To Ignore Shale, And Why It's Important For The Narrative To Change
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