We reiterate our Neutral recommendation on
Noble Energy Inc.
). The oil and gas exploration and production (E&P) company
presently carries a Zacks Rank #3 (Hold).
Why the Reiteration?
Noble Energy reported strong results in the fourth quarter
2012 with both the top and the bottom line beating the Zacks
Consensus Estimates. Positive rate changes, effective execution
of growth programs and persistent customer expansion led the
company to post solid results.
We believe the company's multiple exploration programs in the
U.S. and overseas will help to maintain the momentum. With the
start-up of Tamar and Alen prospects in the Eastern Mediterranean
and West Africa, respectively, we believe the company will
witness a ramp up in sales volume in the coming quarters thereby
contributing to the top line.
Going forward, the company is expected to gain from its
unconventional resource properties in the Niobrara formation as
well as from the new Keota gas plant in Colorado. The big-time
New Ventures exploration project in Nevada is likely to be a
major earnings driver. Moreover, the high-quality reservoir
discoveries in Carla in West Africa and Big Bend in the Gulf of
Mexico are expected to further accentuate growth opportunities in
the near term.
However, exposure to political instability in Africa and
fluctuating oil and gas prices could undermine development
Other Stocks to Consider
Other stocks that are presently performing well include
Range Resources Corporation
EPL Oil & Gas Inc.
Denbury Resources Inc.
). While Range Resources and EPL Oil & Gas carry a Zacks Rank
#1 (Strong Buy) Denbury holds a Zacks Rank #2 (Buy).
DENBURY RES INC (DNR): Free Stock Analysis
EPL OIL&GAS INC (EPL): Free Stock Analysis
NOBLE ENERGY (NBL): Free Stock Analysis
RANGE RESOURCES (RRC): Free Stock Analysis
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