Houston, Texas-based Coterra Energy Inc. (CTRA) is an independent oil and gas company that develops, explores, and produces oil, natural gas, and natural gas liquids. Valued at a market cap of $20.8 billion, the company also operates natural gas and saltwater gathering and disposal systems in Texas.
Shares of this energy company have underperformed the broader market over the past 52 weeks. Coterra has gained 12.2% over this time frame, while the broader S&P 500 Index ($SPX) has gained 23.3%. Moreover, over the past six months, the stock is up 10.5%, compared to SPX’s 11.7% rise.
Nonetheless, narrowing the focus, CTRA has outpaced the Energy Select Sector SPDR Fund’s (XLE) 6.1% gain over the past 52 weeks and a 2.9% decline on a six-month basis.
Coterra released its Q3 earnings results on Oct. 31, and shares of CTRA plunged 5.1% the following day as the company’s EPS of $0.34 per share declined 19% from the year-ago quarter. Weaker oil and natural gas realization and a 10.2% increase in operating expenses led to its bottom line fall. Meanwhile, its revenue of approximately $1.4 billion remained fairly flat year-over-year. On the brighter side, the company raised its production guidance and lowered its capital guidance for the full year, indicating improved capital efficiency.
For the current fiscal year, ending in December, analysts expect CTRA’s EPS to decline 30.1% year over year to $1.53. The company’s earnings surprise history is disappointing. It surpassed the Wall Street estimates in one of the last four quarters while missing on three other occasions.
Among the 24 analysts covering the stock, the consensus rating is a “Strong Buy,” which is based on 19 “Strong Buy,” one “Moderate Buy,” and four “Hold” ratings.
On Jan. 30, Barclays analyst Betty Jiang maintained an “Overweight” rating on Coterra and raised its price target to $36, which indicates a 26.8% potential upside from the current levels.
The mean price target of $34.46 represents a 21.4% upside from CTRA’s current price levels, while the Street-high price target of $41 suggests an upside potential of 44.4%.
