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CNOOC (SEHK:883): Is the Recent Pullback a New Opportunity Based on Its 7.9% Undervaluation?

Simply Wall St · 1d ago

CNOOC (SEHK:883) has quietly pulled back over the past month, even though the shares are still up strongly over the past year and past 3 months. That gap is what investors are debating now.

See our latest analysis for CNOOC.

That recent 7 day and 30 day share price pullback sits against a healthier backdrop, with the 1 year total shareholder return near 25 percent and the 5 year total shareholder return above 360 percent. This suggests momentum is cooling rather than breaking.

If CNOOC’s long run has you thinking about where else value and momentum might line up, it could be a good moment to explore fast growing stocks with high insider ownership.

With earnings still growing, hefty long term returns, and the shares trading below analyst targets and intrinsic value estimates, investors now face a key question: is this a fresh entry point, or is future growth already priced in?

Most Popular Narrative Narrative: 7.9% Undervalued

Compared with the last close of HK$20.68, the most followed narrative points to a fair value near HK$22.46, implying modest upside with carefully modelled assumptions behind it.

The analysts have a consensus price target of HK$21.534 for CNOOC based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of HK$27.64, and the most bearish reporting a price target of just HK$10.61.

Read the complete narrative.

If you want to see what kind of steady growth and margin profile could support that valuation band, and understand why the projected earnings multiple edges above today’s level, you can dive into the full narrative to unpack the precise revenue, profit, and discount rate assumptions shaping this fair value view.

Result: Fair Value of $22.46 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this outlook still leans on sustained oil and gas demand, leaving CNOOC exposed if the energy transition accelerates or LNG prices weaken faster than expected.

Find out about the key risks to this CNOOC narrative.

Build Your Own CNOOC Narrative

If you see the story differently, or simply want to test your own assumptions against the numbers, you can build a custom view in minutes: Do it your way.

A great starting point for your CNOOC research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.