Analysts at Sterne Agree put out a bearish note today on natural gas and oil producer EOG Resources, Inc. ( EOG ).
The firm said it cut its rating on EOG from "Neutral" to "Underperform," citing an upcoming cash flow deficit as the company may struggle to fund its projects.
A Sterne Agee analyst commented, "On a relative basis, we believe that EOG will underperform its peers over the next 12 months. 2012 could be another year lacking returns and our assumptions on the projected activity for 2012 look as if they cannot be funded organically. Assuming a reasonable 5% CAPEX increase for 2012, we see EOG running a cash flow deficit of approximately $2.4 billion."
EOG Resources shares were mostly flat in premarket trading Wednesday.
The Bottom Line
Shares of EOG Resources ( EOG ) have a .74% dividend yield, based on last night's closing stock price of $86.75. The stock has technical support in the $79-$82 price area. If the shares can firm up, we see overhead resistance around the $90-$95 price levels.
EOG Resources, Inc. ( EOG ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.1 out of 5 stars.
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