CNOOC (CEO) Downgraded to Underperform

We are downgrading CNOOC Limited (CEO) ADRs to Underperform from Outperform. We believe that the company has lost its attractiveness as a pure Chinese offshore oil explorer.

While domestic initiatives continue, CNOOC is currently exploring various international upstream projects to cope with the country’s rising demand. We initially thought the $3.1 billion Bridas deal to be a prudent step, but now we are concerned about the challenging Argentine tax regime.

The company is currently experiencing a downward movement in the performance of its ADRs, which we believe will again run into rough weather with oil prices hovering in the mid-$70s. We recommend investors to go for attractively valued peers such as Sinopec.

CNOOC LTD ADR (CEO): Free Stock Analysis Report
Zacks Investment Research

About Zacks Investment Research 1766 Articles

Zacks Investment Research is one of the most highly regarded firms in the investment industry. In 1978 Zacks originated the concept of utilizing earnings estimates revisions to make profitable investment decisions. Zacks offers multiple investment products and services to help investors achieve superior returns.


Be the first to comment

Leave a Reply

Your email address will not be published.