Let’s examine why.
The post Here’s why the Santos (ASX:STO) share price is down 8% in a week appeared first on The Motley Fool Australia. –
The Santos Ltd (ASX: STO) share price has stepped into the red once again during afternoon trade on Friday.
Moreover, shares in the hydrocarbons giant have lagged the S&P/ASX200 index (ASX: XJO) over the past week. Whereas the broad index has slipped 1.7% into the red, Santos shares have fallen around 8%.
Let’s investigate further.
What’s in front of the Santos share price this week?
Despite being a potential positive for the Santos share price, investors don’t seem impressed by the company’s half year results.
Santos recognised net profit after tax (NPAT) of US$354 million, up from US$289 million the year prior.
In addition, revenue increased by 22% year over year, whilst free cash flow came in 33% higher at US$572 million from the same time last year.
Moreover, Santos declared an interim dividend of US5.5 cents per share, a mammoth 162% increase.
Investors haven’t welcomed the news with open arms, as the Santos share price has slipped into the red since the update.
One other headwind that has impacted Santos shares today is the pullback in oil prices that occurred overnight.
Santos, and others in the ASX-listed hydrocarbons basket, are all seeing selling pressures from the drop in prices. Touching US$64.08 a barrel, this marks the sixth straight day of decline in oil spot prices.
Some estimate the dip in oil prices comes on a backdrop of fears of a slowdown in global economic growth.
This has resulted in further selling pressure on the Santos share price, which is down 14% on the month as well.
Santos share price snapshot
The Santos share price has had a choppy year to date, posting a loss of 6% since January 1. However, Santos shares are 5% in the money over the last 12 months.
These returns have lagged the broad index’s return of around 25% over the last year.
Should you invest $1,000 in Santos right now?
Before you consider Santos, you’ll want to hear this.
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*Returns as of August 16th 2021
The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.