Consol Energy’s Stock Price Action after Its 4Q15 Earnings

Consol Energy Beat 4Q15 Revenue Estimates, EPS Short of Estimates

(Continued from Prior Part)

Consol Energy’s stock price increased following 4Q15 earnings

Consol Energy (CNX) announced its 4Q15 earnings on January 29, 2016, before the market opened. After its 4Q15 earnings are announced, CNX’s stock price increased by 17.63% to close at $7.94.

CNX’s stock price in steep downtrend

As illustrated in the above chart, Consol Energy’s (CNX) stock price is in a steep downtrend. The stock is making a clear pattern of lower highs and lower lows.

CNX’s 17.63% stock price increase following its earnings announcement is impressive considering that CNX’s stock price has already increased by ~28% in just six sessions before its earnings were announced. If CNX’s stock price continues this positive momentum and moves above $8.84, it would mark the first higher high in almost 18 months. For any trend change to occur, the stock price must at least produce a higher high.

CNX’s relative performance

For 2015, CNX had underperformed the S&P 500 ETF (SPY) because CNX had lost ~77%, whereas S&P 500 was almost flat during the same period. Compare this with the SPDR S&P Oil and Gas Exploration & Production ETF (XOP), which was down ~36% in 2015. Oil and gas producers Occidental Petroleum (OXY), Pioneer Natural Resources (PXD), and EOG Resources (EOG) were down ~13%, ~16%, and ~23%, respectively.

CNX’s stock price performance after past earnings misses

In the last year, there were two occasions, the 3Q15 and 2Q15 earnings, when CNX missed its earnings expectations. CNX reported its 3Q15 earnings before the market opened on October 27, 2015. In 3Q15, CNX missed the consensus earnings estimates by $0.25 per share. Following the earnings release, worse-than-expected earnings saw CNX’s stock price decline by ~25% in just four sessions.

A downward reaction was observed after the 2Q15 earnings when CNX’s stock price decreased by ~32% in about four weeks after missing the consensus earnings estimates by $0.37 per share.

During these two occasions, CNX missed its earnings by huge margins, with a delta of greater than $0.25 per share.

Browse this series on Market Realist:

• Part 1 - Consol Energy’s 4Q15 Earnings Missed Estimates

• Part 2 - CNX’s 4Q15 Operational Performance, Management Strategies

• Part 3 - Wall Street Analyst Forecasts after Consol Energy’s 4Q15 Earnings