EXCO Resources Inc (NYSE:XCO) Sinks Like a Brick

[[tagnumber 0]][[tagnumber 1]]The oil and gas industry is still experiencing tough times and the price performance of EXCO Resources Inc (NYSE:XCO) shows exactly what most enterprises in the industry have had to cope with. However, EXCO’s shares suffered yet another huge blow last week after expectations of possible higher fuel prices due to the forthcoming summer holidays were dampened by increasing fuel stockpiles. As a result, XCO has lost about 30% in value in a matter of 3 days of trade.[[tagnumber 2]] [[tagnumber 0]][[tagnumber 4]]It all started last Wednesday when XCO dropped to $1.58, down 10% from the day before, on a heavy volume of 7 million, after the government published the increasing stockpile data. The trend continued on Thursday, as well. Yet, it was on Friday that XCO got hit really hard as the stock went a further 20 per cent south on a 52–week record volume of 25 million.[[tagnumber 2]] [[tagnumber 0]]The company’s most recent quarterly report, which saw the light of day on Apr. 29, showed the real impact of the recent slump in oil prices worldwide and in the United States, in particular. As it turned out, Q1 of 2015 brought XCO a net loss of $318 million, which is almost 3 times as much as the combined net profit of the previous three quarters. It also marked a substantial reduction in cash reserves, too. At the same time, the company’s long–term debt remains close to the $1.5 billion mark and there are no indications that this will change any time soon.[[tagnumber 2]] [[tagnumber 0]]From a technical standpoint, XCO has been in a severe downtrend for the last 12 months. What now costs $1.3 per share used to be worth three times as much in July 2014. With the stock now headed again for the oversold area, a minor rebound could occur over the next few weeks. Whether it will be enough to buck the trend or not, however, is a completely different matter.[[tagnumber 2]]