Sub-$50 Oil Sends Premier Oil PLC, Hardy Oil & Gas plc, EnQuest Plc To New 52-Week Lows

As oil plummets, so do shares in Premier Oil PLC (LON: PMO), Hardy Oil & Gas plc (LON: HDY) and EnQuest Plc (LON: ENQ).

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

It’s only a couple of days since the price of a barrel of Brent Crude dropped below $55, and people were already wondering if it would crash through the $50 level.

Well, that question has already been answered as the black stuff dipped to $49.92 in early trading today, although as I write it’s a smidgen above $50 again.

While the big companies like BP and Royal Dutch Shell can ride out such crises, prices like this are seriously hurting some of our smaller firms:

Premier Oil

Shares in Premier Oil (LSE: PMO) crashed to a 52-week low of 146p on Tuesday before recovering a little to end the day at 150.3p, and today they’re heading back down again at 149p as I write. From a 52-week high of 358.6p, Premier Oil is now down 58% with most of that slide coming since the end of September 2014.

At least Premier is profitable and is paying dividends, and there’s a two-year-out P/E of only around 7 forecast for the end of 2016. Is Premier a good oil bet now for the oil price recovery that must eventually come? (It must come, mustn’t it?)


There’s no profit expected at Hardy Oil & Gas (LSE: HDY) before 2017 at the earliest, and that’s made its share price quite a bit more volatile. But its fall from peak to trough is similar to Premier’s — from a 52-week high of 123.75p the shares have slumped 52% to a low of 60p.

Hardy, whose exploration is focused in India, told us in a six-monthly update in November that it was “in a strong working capital position” to fund its plans with $22.9m in cash and equivalents, but the plunge in oil prices must surely require re-evaluation of the viability of some of its explorations.


EnQuest (LSE: ENQ) is the biggest faller of these three, with a jarring crunch of 78% from its 52-week high of 148.4p to a closing low of just 31.75p on Tuesday — at the time of writing, the shares are back up a little to 33p. Over five years, the EnQuest price is down 70%.

EnQuest is actually profitable, although forecast earnings per share are very erratic (as they often are due to the nature of explorers’ income), with a slump to 2.4p forecast for 2015 from an expected 6.5p for the year just ended.

Any bargains?

I reckon investing in oil exploration is only for experts, and only those who have the nerves to handle tough periods like this — but if I was at all tempted, I’d be looking for sustainably profitable companies with plenty of cash on their books.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be considered so you should consider taking independent financial advice.

Alan Oscroft has no position in any shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Smartly dressed middle-aged black gentleman working at his desk
Investing Articles

3 reasons why the Darktrace share price is up 61% over the past month

Jon Smith outlines three of the main reasons in his opinion for the strong bump higher in the Darktrace share…

Read more »

Young woman working at modern office. Technical price graph and indicator, red and green candlestick chart and stock trading computer screen background.
Investing Articles

Should I snap up GSK shares at £14?

The GSK share price has slumped. Should investors pile in or steer clear? Roland Head investigates.

Read more »

pensive bearded business man sitting on chair looking out of the window
Investing Articles

As NIO stock continues to fall, should I buy the dip?

Jabran Khan looks at why NIO stock has dropped in recent months and decides if the shares have fallen enough…

Read more »

Close-up Of A Piggybank With Eyeglasses And Calculator On Desk
Investing Articles

How I’d aim for £10,000 a year in passive income, from £100 per month

We'd all like to have a bit of passive income coming in to supplement our retirement, wouldn't we? Here's how…

Read more »

Storytelling image of a multiethnic senior couple in love - Elderly married couple dating outdoors, love emotions and feelings
Investing Articles

Here’s a cheap FTSE stock with a 6% dividend yield. Should I buy it?

Vodafone is a FTSE stock with an attractive dividend yield, which looks to be on the path to recovery. Here's…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

As the Centrica share price continues to climb, am I too late to buy shares?

This Fool documents the recent rise of the Centrica share price and decides if adding the shares to his holdings…

Read more »

British Pennies on a Pound Note
Investing Articles

Even at 10p, I see the Cineworld share price as expensive. Here’s why

The Cineworld share price has crumbled to around 10p. But the cinema chain still holds no appeal for our writer…

Read more »

Shot of a senior man drinking coffee and looking thoughtfully out of a window
Investing Articles

Should I buy Aviva shares now?

With Aviva shares near 440p, here's what I'd do about this stock now as the business throws off cash and…

Read more »