EOG breaks with industry, plans growth - will Wall Street reward them?
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EOG (NYSE:EOG), the bellwether shale oil producer, broke with industry today at a Goldman Sachs energy conference, saying the Company is ready to get back into growth mode if macro-economic factors are right.
Following a decade of US energy (NYSEARCA:XLE) underperformed versus the S&P 500 (NYSEARCA:SPY), when US shale production repeatedly upset oil market balances, allowing consolidation to ensue at the trough of the pandemic, EOG is looking to get back to work.

EOG's plans run contrary to what CS analyst William Janela wrote today, when he indicated the industry built back better through the pandemic and offers a better value proposition now than it did in early 2020, with a new financial framework focused on shareholder returns rather than production growth.
At the very same Goldman Sachs conference, peer CEOs from Pioneer (NYSE:PXD), Devon (NYSE:DVN) and Diamondback (NASDAQ:FANG)
stuck to the plan of lower capex, slower production growth, and higher shareholder returns.

For years, Chevron management pointed to the energy industry's fall from 10%+ of the S&P 500 market cap to less than 3% as a sign its management teams were too focused on growth and not enough on returns.
With industry leaders Conoco (NYSE:COP), Exxon
(NYSE:XOM) and Chevron
(NYSE:CVX) having already provided year-ahead capital and production guidance -- across-the-board focus on controlling spending and returning cash to shareholders -- the market will now be laser focused as pure-play shale producers update on production plans with earnings later this quarter.
EOG caveated their comment, indicating production growth is dependent on the macroeconomic environment; however, with peers from Shell (NYSE:RDS.A) all the way down to Northern Oil and Gas (NYSE:NOG) focused on stable production and improving shareholder returns, it makes one wonder what EOG knows about the commodity markets that all of their peers are missing.