Zacks Investment Research downgraded
Talisman Energy Inc.
) to a Zacks Rank #5 (Strong Sell) on Jan 9.
Why the Downgrade?
Talisman Energy witnessed sharp downward estimate revisions after
reporting disappointing third-quarter 2012 results. In fact, this
Canadian energy explorer delivered negative earnings surprises in
the last 4 quarters with an average miss of 82.39%. The long-term
expected sales growth rate for this stock is negative 1.95%.
On October 30, 2012, Talisman Energy reported third-quarter 2012
loss per share of 9 cents against the Zacks Consensus Estimate of
earnings of 6 cents and the year-ago earnings of 24 cents per
The loss was mainly due to lower price realizations. Talisman's
realized commodity prices dropped 12.50% from the year-ago
quarter to $57.19 per barrel of oil equivalent (BOE) mainly on
account of sharply lower North American realizations. Overall,
natural gas prices declined 19.2% year over year to $4.89 per
Mcf, while oil and liquids realizations averaged $101.89 per
barrel, down 6.3% from the year-ago level.
Also, cash flow from continuing operations during the quarter
totaled $693.0 million, down 23.2% from the third quarter of
For 2012, most of the estimates (9 out of 12) were revised
downward over the last 60 days, lowering the Zacks Consensus
Estimate by 5.4% to 35 cents per share.
Other Stocks to Consider
Not all energy stocks are performing as poorly as Talisman
Energy. The stocks of
Lone Pine Resources Inc.
Cabot Oil & Gas Corporation
) are worth considering. Both carry a Zacks Rank #1 (Strong Buy).
CABOT OIL & GAS (COG): Free Stock Analysis
LONE PINE RSRCS (LPR): Free Stock Analysis
TALISMAN ENERGY (TLM): Free Stock Analysis
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