Ecopetrol (EC) Cut to “Hold” at Zacks Investment Research

Ecopetrol (NYSE:EC) was downgraded by Zacks Investment Research from a “strong-buy” rating to a “hold” rating in a research report issued to clients and investors on Thursday.

According to Zacks, “In Colombia, Ecopetrol is the largest energy firm with an integrated business model. The company’s businesses are well diversified, extending from oil and natural gas exploration & production activities to transporting crude volumes along with refining and distributing petroleum products. With the ‘oilier’ nature of its volume mix position, Ecopetrol is capitalizing on strengthening crude prices. Notably, to reach its production growth target for 2018, the company is planning to drill more than 620 development wells, up from 491 in 2017.  However, high oil prices have been affecting the company’s refining businesses. On top of that, inspite of the company’s huge capital spending, the company projected production between 715 MBoE/D and 725 MBoE/D, marginally higher than last year’s output of 715 MBoE/D. Hence, the inefficient use of capital could hurt the company’s growth.”

A number of other equities research analysts have also recently issued reports on EC. Citigroup upgraded Ecopetrol from a “sell” rating to a “neutral” rating in a research note on Thursday, August 2nd. ValuEngine cut Ecopetrol from a “buy” rating to a “hold” rating in a research note on Friday, August 3rd. Four equities research analysts have rated the stock with a sell rating and five have assigned a hold rating to the company’s stock. The stock has a consensus rating of “Hold” and a consensus price target of $17.67.

Ecopetrol stock traded down $0.47 during midday trading on Thursday, reaching $25.41. The stock had a trading volume of 26,483 shares, compared to its average volume of 1,390,720. Ecopetrol has a 12 month low of $9.81 and a 12 month high of $27.96. The stock has a market capitalization of $55.36 billion, a P/E ratio of 23.43, a P/E/G ratio of 0.89 and a beta of 1.26. The company has a debt-to-equity ratio of 0.68, a quick ratio of 1.15 and a current ratio of 1.45.

Ecopetrol (NYSE:EC) last announced its quarterly earnings data on Tuesday, August 14th. The oil and gas company reported $0.60 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $0.58 by $0.02. Ecopetrol had a return on equity of 11.69% and a net margin of 17.52%. The business had revenue of $5.95 billion for the quarter, compared to analysts’ expectations of $5.99 billion. Equities research analysts forecast that Ecopetrol will post 2.08 EPS for the current fiscal year.

Several institutional investors and hedge funds have recently made changes to their positions in the company. Acadian Asset Management LLC increased its position in shares of Ecopetrol by 54.4% during the second quarter. Acadian Asset Management LLC now owns 9,879,374 shares of the oil and gas company’s stock valued at $203,014,000 after buying an additional 3,479,971 shares during the period. Renaissance Technologies LLC grew its holdings in shares of Ecopetrol by 0.3% during the second quarter. Renaissance Technologies LLC now owns 7,149,900 shares of the oil and gas company’s stock worth $146,930,000 after purchasing an additional 18,700 shares in the last quarter. Legal & General Group Plc grew its holdings in shares of Ecopetrol by 11.0% during the first quarter. Legal & General Group Plc now owns 1,272,272 shares of the oil and gas company’s stock worth $24,587,000 after purchasing an additional 125,761 shares in the last quarter. Fisher Asset Management LLC purchased a new position in shares of Ecopetrol during the second quarter worth about $15,187,000. Finally, Global X Management Co LLC grew its holdings in shares of Ecopetrol by 8.5% during the second quarter. Global X Management Co LLC now owns 703,483 shares of the oil and gas company’s stock worth $14,457,000 after purchasing an additional 55,206 shares in the last quarter. Hedge funds and other institutional investors own 2.85% of the company’s stock.

About Ecopetrol

Ecopetrol SA operates as an integrated oil and gas company. It operates through three segments: Exploration and Production; Refining, Petrochemical, and Biofuels; and Transport and Logistics. The company produces crude oil and gas; and engages in the extraction, collection, treatment, storage and pumping or compression of hydrocarbons.

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