Q2 STOCKS TO BUY

As Oil Prices Sink, So Do These 3 Stocks

SLB, MRO, and HAL are all lower today

Managing Editor
Nov 23, 2018 at 11:57 AM
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Stocks are looking getting crushed once more today, thanks again to a tech sell-off, but also because of plummeting oil prices, which earlier fell to a more than 12-month low. Among individual oil names making moves lower are Schlumberger Limited (NYSE:SLB), Marathon Oil Corporation (NYSE:MRO), and Halliburton Company (NYSE:HAL). Here's a quick look at what's moving shares of SLB, MRO, and HAL.

SLB Options Traders Turning Toward Puts

At last check, Schlumberger stock was down 3.2% to trade at $46.14, and earlier fell to a new nine-year low of $45.96. SLB has now shed 31% in 2018, and is heading for its seventh straight weekly loss. 

In the options pits, put buying has been gaining popularity amid the stock's decline. SLB's 10-day put/call volume ratio of 0.59 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 76th percentile of its annual range. While this shows that purchased SLB calls have outnumbered puts on an absolute basis, speculators have shown a healthier-than-usual appetite for bearish bets during the past two weeks.

MRO Still Has Analyst Support Despite Struggles

For Marathon Oil stock -- down 3.4% to trade at $15.85, at last check -- the technical picture is similar. The shares are heading toward their fifth straight weekly loss, and recently breached their 320-day moving average for the first time on a closing basis since early March. Overall, the equity has shed 35% since its Oct.3 high of $24.20.

Analysts remain steadfast in their support for MRO. Of the 16 brokerages covering the oil stock, 12 rate it a "strong buy," with zero "sells" on the books. Further, its consensus 12-month price target of $25.24 is a 60% premium to its current perch.

HAL Sinks to New Two-Year Low

Looking at Halliburton, the stock is down 4% to trade at $30.66, and earlier fell to a new two-year low of $30.49. HAL has shed 37% in 2018, with a rebound attempt in early October contained by the shares' 80-day moving average. 

Shorts have been piling on in recent weeks. Short interest increased by 15% in the most recent reporting period, to 20.25 million shares, the most since April. Still, this only represents a slim 2.3% of HAL's total available float, indicating there is ample room aboard the bearish bandwagon.

 

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