In its note to clients disclosing the cuts, Goldman Sachs said "we believe equity investor expectations on oil may stay more cautious in the medium term."
The firm added: "While [the Organization of the Petroleum Exporting Countries] has indicated willingness this week to continue to sacrifice market share until shale matures, we believe the need for OPEC production to be flat to down in 2020 even in a healthy economic growth environment means that equity investors will likely be more willing to underwrite longer-term prices at the low end of an oil range of $50-$60/[barrel West Texas Intermediate] and $55-$65/[barrel] Brent."
As such, the firm lowered the West Texas Intermediate oil prices and its Henry Hub gas prices in its base valuation scenarios, which resulted in lower price targets across the sector.
Goldman Sachs also cautioned clients ahead of Q2 earnings reports due later this month that it expects consensus estimates for earnings and cash flow "to fall on account of commodity prices."
The stocks that received cuts to their price targets from Goldman Sachs included Apache (APA), Hess (HES), Marathon Oil (MRO), Noble Energy (NBL), Murphy Oil (MUR), Pioneer Natural Resources (PXD), Concho Resources (CXO), Diamondback Energy (FANG), Laredo Petroleum Holdings (LPI), Parsley Energy (PE), Continental Resources (CLR), California Resource (CRC), Brigham Minerals (MNRL), EOG Resources (EOG), Chesapeake Energy (CHK), Encana (ECA), Cimarex Energy (XEC), WPX Energy (WPX), Cabot Oil & Gas (COG), Southwestern Energy (SWN), Range Resources (RRC), Antero Resources (AR) and EQT Corp. (EQT).
Price: 27.18, Change: -0.10, Percent Change: -0.37
|Significant Insider Selling Continues at CarGurus (C...|
|Significant Insider Sales in Shares of Facebook (FB)...|
|Insider Sale at Zumiez (ZUMZ) Continues Selling Trend|
|Continued Level of Significant Insider Selling at e....|
|Goosehead Insurance (GSHD) Insiders Make Significant...|