NYSE:CXO

Stock Analysis Report

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Executive Summary

Concho Resources Inc., an independent oil and natural gas company, engages in the acquisition, development, and exploration of oil and natural gas properties in the United States.


Snowflake Analysis

Adequate balance sheet with moderate growth potential.


Similar Companies

Share Price & News

How has Concho Resources's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CXO's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-4.9%

CXO

-4.4%

US Oil and Gas

2.3%

US Market


1 Year Return

-50.3%

CXO

-43.6%

US Oil and Gas

6.7%

US Market

Return vs Industry: CXO underperformed the US Oil and Gas industry which returned -43.6% over the past year.

Return vs Market: CXO underperformed the US Market which returned 6.7% over the past year.


Shareholder returns

CXOIndustryMarket
7 Day-4.9%-4.4%2.3%
30 Day-15.1%-9.7%6.0%
90 Day-3.8%5.5%18.9%
1 Year-49.8%-50.3%-41.0%-43.6%9.0%6.7%
3 Year-60.4%-60.9%-35.4%-42.3%36.6%27.7%
5 Year-51.4%-52.0%-38.5%-48.6%64.2%46.1%

Price Volatility Vs. Market

How volatile is Concho Resources's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Concho Resources undervalued compared to its fair value and its price relative to the market?

1.15x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: CXO ($49.24) is trading above our estimate of fair value ($34.49)

Significantly Below Fair Value: CXO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: CXO is unprofitable, so we can't compare its PE Ratio to the US Oil and Gas industry average.

PE vs Market: CXO is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate CXO's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: CXO is overvalued based on its PB Ratio (1.1x) compared to the US Oil and Gas industry average (0.7x).


Next Steps

Future Growth

How is Concho Resources forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

78.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CXO is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (2.2%).

Earnings vs Market: CXO is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: CXO's is expected to become profitable in the next 3 years.

Revenue vs Market: CXO's revenue (4.5% per year) is forecast to grow slower than the US market (9.4% per year).

High Growth Revenue: CXO's revenue (4.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CXO's Return on Equity is forecast to be low in 3 years time (10.3%).


Next Steps

Past Performance

How has Concho Resources performed over the past 5 years?

-20.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CXO is currently unprofitable.

Growing Profit Margin: CXO is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: CXO is unprofitable, and losses have increased over the past 5 years at a rate of -20.1% per year.

Accelerating Growth: Unable to compare CXO's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: CXO is unprofitable, making it difficult to compare its past year earnings growth to the Oil and Gas industry (-21.6%).


Return on Equity

High ROE: CXO has a negative Return on Equity (-110.84%), as it is currently unprofitable.


Next Steps

Financial Health

How is Concho Resources's financial position?


Financial Position Analysis

Short Term Liabilities: CXO's short term assets ($2.3B) exceed its short term liabilities ($1.0B).

Long Term Liabilities: CXO's short term assets ($2.3B) do not cover its long term liabilities ($4.2B).


Debt to Equity History and Analysis

Debt Level: CXO's debt to equity ratio (46.8%) is considered high.

Reducing Debt: CXO's debt to equity ratio has reduced from 56.3% to 46.8% over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable CXO has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: CXO is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 11.4% per year.


Next Steps

Dividend

What is Concho Resources's current dividend yield, its reliability and sustainability?

1.62%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CXO's dividend (1.62%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.68%).

High Dividend: CXO's dividend (1.62%) is low compared to the top 25% of dividend payers in the US market (4.6%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether CXO's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if CXO's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: CXO is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: CXO's dividends in 3 years are forecast to be well covered by earnings (21.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.2yrs

Average management tenure


CEO

Tim Leach (60yo)

14.42yrs

Tenure

US$12,958,451

Compensation

Mr. Timothy A. Leach, also known as Tim, serves as Chairman and Chief Executive Officer at Concho Resources Inc. since February 2006 and served as its President from July 1, 2009 to May 18, 2017. Mr. Leach ...


CEO Compensation Analysis

Compensation vs Market: Tim's total compensation ($USD12.96M) is about average for companies of similar size in the US market ($USD11.50M).

Compensation vs Earnings: Tim's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Timothy Leach
Chairman of the Board & CEO14.42yrsUS$12.96m0.42% $40.0m
Jack Harper
President3.17yrsUS$11.37m0.095% $9.1m
Brenda Schroer
Senior VP1.5yrsUS$2.93m0.022% $2.1m
C. Giraud
Executive VP & COO1.5yrsUS$10.58m0.090% $8.6m
Travis Counts
Senior VP7.17yrsUS$3.27m0.025% $2.4m
Jacob Gobar
VP & Chief Accounting Officer1.5yrsno data0.0055% $528.7k
Kang Chen
VP & Chief Information Officerno datano datano data
Scott Kidwell
Senior Vice President of Administration1.5yrsno data0.0061% $583.5k
Megan Hays
VP of Investor Relations & Public Affairs3.5yrsno datano data
Gayle Burleson
Senior Vice President of Business Development & Land3.17yrsno data0.024% $2.3m
Erick Nelson
Senior Vice President of Operations & Production3.17yrsno data0.036% $3.5m
Clay Bateman
Senior Vice President of Assets1.5yrsno data0.022% $2.1m

3.2yrs

Average Tenure

50yo

Average Age

Experienced Management: CXO's management team is considered experienced (3.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Timothy Leach
Chairman of the Board & CEO14.42yrsUS$12.96m0.42% $40.0m
Steven Gray
Independent Director2yrsUS$291.74k0.13% $12.3m
Mark Puckett
Lead Independent Directorno dataUS$333.24k0.018% $1.7m
William Easter
Independent Director12.42yrsUS$311.74k0.021% $2.1m
Tucker Bridwell
Independent Director14.42yrsUS$291.74k0.027% $2.6m
Gary Merriman
Independent Director8.5yrsUS$306.74k0.012% $1.2m
E. Wright
Director3.17yrsUS$324.46k0.046% $4.4m
Steven Beal
Independent Director14.42yrsUS$316.74k0.060% $5.8m
Susan Helms
Independent Director3.33yrsUS$291.74k0.0037% $355.7k

10.5yrs

Average Tenure

62yo

Average Age

Experienced Board: CXO's board of directors are seasoned and experienced ( 10.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CXO insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Concho Resources Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Concho Resources Inc.
  • Ticker: CXO
  • Exchange: NYSE
  • Founded: 2006
  • Industry: Oil and Gas Exploration and Production
  • Sector: Energy
  • Market Cap: US$9.612b
  • Shares outstanding: 195.21m
  • Website: https://www.concho.com

Number of Employees


Location

  • Concho Resources Inc.
  • One Concho Center
  • 600 West Illinois Avenue
  • Midland
  • Texas
  • 79701
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CXONYSE (New York Stock Exchange)YesCommon StockUSUSDAug 2007
KIJDB (Deutsche Boerse AG)YesCommon StockDEEURAug 2007
CXO *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNAug 2007
0I2TLSE (London Stock Exchange)YesCommon StockGBUSDAug 2007
C1XO34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 COMBRBRLDec 2019

Biography

Concho Resources Inc., an independent oil and natural gas company, engages in the acquisition, development, and exploration of oil and natural gas properties in the United States. The company’s principal operating areas are located in the Permian Basin of West Texas and southeast New Mexico. As of December 31, 2019, its estimated proved reserves totaled 1.0 billion barrels of oil equivalent. The company was founded in 2006 and is headquartered in Midland, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/13 07:12
End of Day Share Price2020/07/10 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.