U.S. oil prices have rallied in recent months, with the price of American crude increasing by almost 70% since the November election. An increase in consumer confidence and a slow but gradual recovery in the wider economy are contributing to confidence in the market. Apache Corp. (NASDAQ: APA) is an independent oil and gas company with a strongly implied upside.
Apache had a difficult 2020, due to restrictions and a drop in global economic activity brought on by the Coronavirus Pandemic. The company reported an adjusted loss of -$407 million, or -$1.08 per common share. Losses were minimized thanks to the implementation of run-rate cost savings exceeding $400 million. 2021 is likely to be a stronger year. Oil production is expected to decline by a modest 1%, which should limit any revenue and earnings shortfalls.
Speculatively, this stock and the company could perform well this year. Oil prices are increasing, and some analysts have predicted U.S. crude prices will hit $100 per barrel as demand from consumer and industrial channels increases. The high-end target price of $34.00 suggests that a significant upside is available for investors on this pick. This stock is a bet not only on oil but also on America’s wider recovery. At a reasonable price and with a moderate dividend yield of 0.51%, it’s a stock to watch.
- 1 Year Price Growth: -21.89%
- YTD Price Growth: 56%
- 3 Month Price Growth: 80%
All information is based on current and historical market data, as well as publicly available financial data. As with any financial decision, your own research is important. Stock market outcomes can never be 100% accurately predicted. Familiarity with historical data, individual industries, and individual stocks is key to developing a robust portfolio. Note that stock prices can fluctuate rapidly during trading sessions.