YPF Sociedad Anónima (NYSE: YPF) is a majority state-owned energy company. The company engages in oil and gas exploration, production, refining, marketing, and export of oil and gas resources from Argentina. The company stock soared by nearly 40% on Monday, November 20, 2023, after the newly elected president, Javier Milei, won the election.
Why YPF Sociedad Anónima Soared
The company’s stock soared following the victory of Milei, who has promised to revamp the Argentine economy. One of his campaign promises was to privatize YPF. Following the election results, New York-listed shares of YPF rose by nearly 40% to $14.90. As of November 21, 2023, YPF stock is trading at $15.03.
Milei has promised to revamp Argentina’s economy, which will entail promoting the use of the US dollar. Additionally, he will consider selling state-owned firms to boost government coffers. Argentina nationalized YPF over a decade ago when it seized a 51% stake in the company. It effectively deposed Spain’s Repsol from control of the company, and it now handles the country’s massive oil and gas reserves.
Besides YPF, other major Argentine-linked stocks saw significant gains during Monday’s trading session. Shares of Banco Macro and Grupo Financiero Galicia saw their stock rise over 20%. The Global X MSCI Argentina ETF also rose 11.6% during the trading session.
Investors will no doubt be closely examining the exchange rate between the dollar and the Argentine peso amidst plans by Milei to increase dollar usage in the country. It is part of a grand plan by the newly elected president to battle historic inflation.
Earnings Report
YPF Sociedad Anónima released its earnings report for fiscal Q3 2023 on November 9, 2023. In the report, the company reported a revenue of $4.50 billion, a decline of 15.9% from the same time last year when it reported $5.36 billion.
Its EPS was $0.33, representing an 81.25% decline from last year when it reported an EPS of $1.76. In the past two quarters, YPF Sociedad Anónima has missed EPS estimates by an average of 17%.
YPF Sociedad Anónima (YPF) Stock Performance
YPF stock has had a great run in 2023, having risen 72.33% year-to-date. Most of that growth has taken part in the past day following the presidential election’s outcome. In the past 12 months, the stock is up 106.46%.
Stock Price Forecast
Despite the recent strong performance of YPF stock, market analysts give it a hold rating. They give the stock a high price target of $30 and a low of $8. The median price target for the stock is $12.50, which a 16.83% downside based on the latest price of $15.03. Its hold rating has held steady for most of November.
Should You Buy YPF Stock
YPF stock currently has a hold rating. It means that stock analysts expect it to perform like the general stock market for the next 12 months. However, the $30 upside is worth noting. If President Milei executes his privatization plan flawlessly, it could hit that price point.
The process could drag out for months if not years. Additionally, the president might prioritize other aspects of the economy. Consequently, investors planning to invest in YPF stock will have to keep a close eye on policy developments in Argentina. Additionally, they will have to monitor global energy prices, which will affect the stock price.
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