New year may mean new view on energy stocks |
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(Reuters) Last year was an ugly one for the U.S. energy sector, and while the first trading day of 2015 pointed to continued weakness in oil, investors are starting to look to when the sector might start to recover.
Crude oil prices fell 42 percent in the fourth quarter. The fallout on corporate bottom lines isnt yet known, but forecasts suggest it will be severe. Energy sector earnings are seen down 19.6 percent in the fourth quarter, according to Thomson Reuters data; on Oct. 1, the consensus estimate was for growth of 6.4 percent.
While the flip in expectations is bearish, analysts say the dramatic decline in the stocks means some investors are going to start looking for buying opportunities.
It wont surprise anyone to see profits fall, so if you have no exposure this is a good time to step in, said Scott Wren, senior equity strategist at St. Louis-based Wells Fargo Advisors, which has an equal weight rating on the sector. The market is ready for bad news.
http://www.reuters.com/article/2015/01/03/us-marke...eekahead-idUSKBN0KB1AT20150103
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