Texas-based Noble Energy (NBL) is an independent oil and gas exploration and production (E&P) company with high-grade hydrocarbon assets across the U.S. and several international locations. The low-risk development projects of the company balance its high-impact exploration opportunities.

In the U.S., the onshore assets provide stable performance and the offshore assets in the deepwater Gulf of Mexico offer significant growth opportunities over medium to long-term. Noble’s international operations – with core positions in Equatorial Guinea and Israel – are a source of low-cost, long-term production base; they do not require huge maintenance capital and diversify the overall portfolio.

Noble maintains a disciplined investment approach and a strong balance sheet with sufficient liquidity and financial flexibility. It has been sensibly allocating resources to long-term development projects, which are vital for its future growth and trying to live within generated cash flows.

Going forward, the ongoing major development projects in deepwater Gulf of Mexico, Equatorial Guinea and Israel will create substantial value for the shareholders.

However, the present unfavorable macro backdrop remains a concern and might overshadow the positives, at least in the near term. As such, we see the stock performing in line with the broader market and rate it as Neutral.

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Zacks Investment Research