Caterpillar: Zacks’ Bear of the Day Play

Thanks to the recent OPEC deal and a better economic outlook, investors are once again returning to the energy sector. Estimates have also been on the rise for this market too, and the energy segment now has a top 20% sector rank heading into 2017.

But with such strength, how do you find the best positioned names? Well, looking at some of the promising industries in the oil sector which look to benefit from recent trends is an excellent idea. In particular, companies in the exploration market look to perform quite well, while a U.S-focus isn’t going to hurt matters either.

In terms of these companies, one that just received an upgrade and could be worth a closer look is Newfield Exploration (NFXFree Report) . Not only has this company just received a bump in its rank, but the stock has seen rising earnings estimates and is down a bit from its 2016 highs, making it a perfect candidate for a bounce in 2017.

Recent Estimates

Analysts have been nearly universally raising their estimates for NFX stock, as the company has seen 13 estimates go higher in the past two months compared to zero lower, while we have seen twelve estimates go higher for the following year compared to zero lower.

While this is certainly impressive, the magnitude of the estimate increases is arguably even more astounding, as the company has seen the consensus estimate surge by about 37% for the full year and 43% for the next year time frame. Add in the fact that the most recent estimates for NFX have been even more positive than the consensus—5.6% higher to be more exact—and you can see why a bullish story is developing, even if the stock price hasn’t gone in the right direction as of late.

NEWFIELD EXPL Price and Consensus

NEWFIELD EXPL Price and Consensus | NEWFIELD EXPL Quote

No wonder shares of NFX have a Zacks Rank #1 (Strong Buy) and why we are looking for outperformance from this stock in the New Year.

Bottom Line

The oil industry looks to be on the upswing in 2017 and the sector has seen rising estimates almost across the board. This means that there are several strong companies to pick from in this group and a bunch of great industries too.

One that stands out in this strong group is the exploration market and NFX in particular. This company has seen surging estimates and it was actually just upgraded to ‘strong buy’ territory within the past week. So, consider using the recent dip in shares of NFX to take a closer look at this company which could be in a great position to have a stellar start to 2017 as this industry continues to make a comeback in the New Year.

Zacks’ Top 10 Stocks for 2017

In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?

Who wouldn’t? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank.

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NEWFIELD EXPL (NFX) – free report >>


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