Vista Energy is finding support at the 10-week moving average. That is sound action after shares broke out from a base at a buy point of 52.47 two days after third quarter earnings were announced for the energy stock.
Vista stock has soared this year and holds an 81% gain year-to-date, and is just a little over 10% away from its all-time high of 59.47. Vista Energy is Monday's selection for IBD 50 Stocks To Watch.
On Oct. 23 Vista reported third quarter results. Shares rebounded from the 50-day moving average and broke out Oct. 25. Sales and earnings grew for the second continuous quarter as the company pivoted from several quarters of declining results.
Sales grew 53% to $462.4 million while earnings of $1.66 rose 102% from the prior year. For the current quarter, analysts expect an increase in profits with per-share earnings of $1.18, which would be 215% higher than the fourth quarter in 2023.
SPAC Bet Pays Off For Energy Stock
Vista operates shale oil wells in over 1,000 locations in Vaca Muerta, Argentina. Shale oil is a type of unconventional oil released through hydraulic fracturing, or "fracking," by drilling holes in shale rock.
Shares started trading on the New York Stock Exchange at an initial offering price of $9.25 on July 26, 2019, after a special purpose acquisition company (SPAC) acquired two companies in Argentina in 2018.
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The stock has strong ratings from Investor's Business Daily after a 479% gain since its IPO. The Composite Rating shows all-around strength at 92. The EPS Rating of 99 has benefited from Vista's recent earnings growth. The stock has also outdone 90% of other stocks in the IBD database in terms of 12-month price performance.
Vista ranks first in the international oil and gas producers group, according to IBD Stock Checkup.
However, the relative strength line, which compares the stock's performance with the benchmark S&P 500 index, has flattened out.
Much of Vista's outperformance vs. the S&P was in the first five months of the year, when it gained 64% while the index gained just 11%. Annually, analysts expect slowing profit growth, with $5.33 earnings per share in 2024 and $6.07 in 2025.
But institutional holdings remain high at 61% of shares outstanding. Funds have been net buyers in more recent weeks as well, as the Accumulation/Distribution Rating of B- shows.
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