Rate Of Return$CNOOC (00883)$
It's surprising that investors are even rejecting an 8.2% dividend yield and a growth stock with a P/E of just 5. Even if oil prices drop a few more dollars, the impact on profits would only be around 2 billion yuan.
Who's in such a hurry to sell? Well, no choice but to lie flat and collect dividends.
According to the three-year plan, CNOOC's production will continue to grow by about 11% in 2025. So the growth potential is excellent. The profit forecasts below are entirely acceptable. What if crude oil isn't as bad as everyone thinks? After all, the gold-to-oil ratio is at a high level, indicating oil prices are too low. They've already hit shale oil's breakeven cost, so shale oil production in 2025 can't increase. Supply will inevitably shrink, while China's stimulus and U.S. rate cuts will gradually boost demand.
At $70 oil, net profit would be around 150 billion yuan.
At $60 oil, net profit would be around 130 billion yuan.
At $50 oil, net profit would be around 100 billion yuan.
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