Unfavorable Commodity Markets Keep Swift Energy Company (NYSE:SFY) Well Below Expectations
[[tagnumber 0]][[tagnumber 1]]The last twelve months have been rough at best for the stock of Swift Energy Company (NYSE:<a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a>). Back then, <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> shares were worth five times as much as they are worth right now. For an independent oil and gas enterprise with proved reserves in excess of 193 Mmboe, such a dramatic slump is hardly something <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> managers may be proud with.[[tagnumber 2]] [[tagnumber 0]][[tagnumber 4]]It all started in early–August when you could buy an <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> share at around $12.00. Those who did must have exited their positions fairly soon because Swift Energy‘s stock had lost a whopping 78% in value by mid–December, followed by a further 24% slump to a 52–week low of $2.01 on Mar. 17. After a short subsequent rebound above the $3.00 mark, <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> headed south again and would probably be digging a new 52–week low right now had it not been for the three per cent it gained in each of the last two trading sessions. As a result, <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> closed yesterday at $2.29 on a volume of 1.5 million, slightly below the average daily turnover for the last 30 days.[[tagnumber 2]] [[tagnumber 0]]So what has led to the chart development described above? Was it Swift Energy‘s fault or someone else‘s?[[tagnumber 2]] [[tagnumber 0]]Being a price taker in the oil and gas industry, <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> is heavily dependent upon the price of the underlying commodity markets. When we look into the company‘s first quarter report for 2015, we see a a mix of positive and not so positive facts and figures. Swift Energy raked in more than $68 million in revenue, yet this number pales in comparison to the corresponding quarter in 2014 when that same company doing the same business generated almost $150 million. What investors should not forget, however, is the fact that the average crude oil price has since gone down a whopping 55% and the average natural gas price has followed suite by taking a 40% plunge. Just like another E&P entity which we covered recently, Swift Energy‘s management has had to write down a staggering $502 million of its properties. The average price at which <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> was able to realize its output was 57 per cent lower when compared to Q1 2014.[[tagnumber 2]] [[tagnumber 0]]Considering the high volatility of the commodity oil and gas market, a potential resurgence of <a href=“http://www.thehotpennystocks.com/Stock–Quotes/?stock=SFY“>SFY</a> shares on the charts in the coming months is not to be excluded. Yet, a balanced corporate policy in a medium of falling commodity prices would not hurt, either.[[tagnumber 2]]
