WTI · W&T Offshore
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $3.74
Note written ·
Price against the kill line
10.4% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $3.74, on record since 11 November 2026. The shares are down 10.1% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $3.74, just over the 50-day average of closes, which would show the shares leading the S&P 500 again; fourth-quarter production above the 35.3 MBoe/d top of guidance would also show that.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Energy
Quarter to 30 September 2026, filed 29 October 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 167
- Revenue, change on a year (%)
- +31.0
- Operating margin (%)
- 7.1
- Net cash, cash less debt ($M)
- −161
- Enterprise value to sales (×)
- 1.1
- Enterprise value to operating income (×)
- 22.7
All filed numbers
What W&T Offshore reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Operating margin (%) |
|---|---|---|---|
| first filed | 167 | +31.0 | 7.1 |
| first filed | 163 | +32.9 | 13.9 |
| first filed | 150 | +15.5 | 9.8 |
| first filed | 122 | +1.1 | −15.7 |
| first filed | 128 | +5.1 | −9.9 |
| first filed | 122 | −14.3 | −10.5 |
| Pre-tax income ($M) | −13.2 |
| Net income ($M) four quarters: −50.7 | −13.6 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | +2.2 |
| Operating cash flow ($M) | 98.5 |
| Capital spending ($M) | Not reported |
| Free cash flow ($M) | Not available |
| Cash and short-term investments ($M) | 191 |
| Debt ($M) long-term debt | 352 |
| Net cash, cash less debt ($M) | −161 |
| Deferred revenue ($M) | Not reported |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 79.1 |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | −190 |
| Market value ($M) | 519 |
| Enterprise value, market value plus net debt ($M) | 680 |
| Enterprise value to sales (×) | 1.1 |
| Enterprise value to operating income (×) | 22.7 |
| Price to earnings (×) | Not meaningful |
| Price to book value (×) | Not meaningful |
| Free-cash-flow yield (%) | Not available |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 8.7% of shares outstanding sold short, 4.1 days of average trading to cover, −5.8% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $0 |
| 12 monthsfrom | $0 | $1.1M |
The thesis
W&T Offshore, a Gulf of Mexico oil and gas producer, is more likely to lag the S&P 500 over the next three months. Fourth-quarter production is guided below the third quarter, crude has been falling, and the shares trade under both their 50-day and 200-day averages. Crude's direction and fourth-quarter volumes, with hurricane season ending on 30 November 2026, decide whether that changes.
The third quarter itself was strong. The company reported on 29 October 2026 production of 38.2 thousand barrels of oil equivalent per day (MBoe/d), above the 33.3–36.8 MBoe/d guidance, and company-defined free cash flow of $33.2 million. Revenue was $167.1 million. The net loss was $13.6 million, or $(0.09) per diluted share, after a $15.8 million derivative loss.
The shares have not rewarded that report. They closed at $3.09 on 6 November 2026, fell to $2.89 on 10 November 2026 and recovered to $3.32 on 12 November 2026. The 3-month change is −9.0%.
Bullish and bearish views on W&T Offshore, Inc.
The bull case on W&T Offshore, Inc. (WTI), in brief: production beat guidance clearly. The bear case: fourth-quarter volumes are guided down.
Bull case
- Production beat guidance clearly. Third-quarter output of 38.2 MBoe/d was above the top of the 33.3–36.8 MBoe/d range and 10% above the second quarter (company release, 29 October 2026).
- Earnings and sales beat estimates. Adjusted earnings per share of $0.01 compared with an estimated $(0.05), and sales of $167.080 million compared with an estimated $143.480 million (company news, 30 October 2026).
- Cash generation repeated. Free cash flow was $33.2 million against $31.4 million in the second quarter, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) was $51.1 million (company release, 29 October 2026).
- Balance sheet improved. At 30 September 2026, unrestricted cash was $191.3 million, net debt $160.7 million (0.9 times trailing adjusted EBITDA) and total liquidity $234.7 million. Net debt was $200.9 million at 30 June 2026.
- Credit terms loosened. On 1 October 2026 the revolver converted to a reserve-based facility, which removed the 75% excess cash flow sweep and raised annual restricted payments capacity from $10 million to $15 million.
Bear case
- Fourth-quarter volumes are guided down. Production guidance is 32.0–35.3 MBoe/d, below the 38.2 MBoe/d reported for the third quarter. The company attributes about 2,600 barrels of oil equivalent per day to Hurricane Isaias and a planned Mobile Bay turnaround (company release, 29 October 2026).
- Crude fell sharply. West Texas Intermediate for December delivery settled at $86.85 a barrel on 9 November 2026, down 4.38%, and Brent for January settled at $92.57, down 5.85%. The company's realised oil price was $85.06 a barrel in the third quarter before derivative settlements, down 14% from the second quarter.
- Peace hopes weigh on oil. Nation Thailand reported on 3 November 2026 that Brent fell 1% amid hopes for peace deals.
- Hedging losses reached the bottom line. The $15.8 million derivative loss turned a second-quarter profit of $12.6 million into the third-quarter loss.
- The company issued shares. It sold 3.6 million shares through its at-the-market program for $14.7 million of net proceeds in the third quarter (company release, 29 October 2026).
Price setup
The shares closed at $3.32 on 12 November 2026. That is 34.6% below the 52-week intraday high of $5.08 set on 19 May 2026, and well above the 52-week closing low of $1.50 on 7 January 2026.
As of 12 November 2026 the 50-day average of closes is $3.72 and the 200-day average is $3.46. The latest close is under both. The 50-day average sits above the 200-day, so the longer-run trend has not yet turned down.
The 10 November 2026 close of $2.89 is the recent low. The shares rose to $3.16 on 11 November 2026 and $3.32 on 12 November 2026, while the 14 August 2026 close was $3.67. A close above the 50-day average would put the shares back above their three-month reference level.
Catalysts ahead
- 19 November 2026: Payment date for the $0.01 per share fourth-quarter dividend. Confirms the cash payout continues alongside at-the-market share sales.
- 30 November 2026: End of the Atlantic hurricane season. Until then, Gulf of Mexico storms can force shut-ins that cut volumes below the 32.0–35.3 MBoe/d fourth-quarter guidance.
- ~8 December 2026 (est.): EIA December Short-Term Energy Outlook. Updates the official crude forecast against which W&T's unhedged 2027 production is priced.
- ~10 March 2027 (est.): Fourth-quarter and full-year 2026 results. Shows whether production landed inside 32.0–35.3 MBoe/d and whether free cash flow stayed positive.
What would change the view
A daily close above $3.74, just over the 50-day average of closes, which would show the shares leading the S&P 500 again; fourth-quarter production above the 35.3 MBoe/d top of guidance would also show that.
What it trades with
W&T trades with U.S. small-cap oil and gas producers and with crude prices. Its all-offshore Gulf of Mexico operations add hurricane exposure that onshore producers lack. The name is the offshore producer W&T Offshore, and it is unrelated to the West Texas Intermediate benchmark that shares its ticker letters. Crude fell on 9 November 2026, and the shares closed at $3.07 that day and $2.89 the next, which fits the link to oil.
The evidence, claim by claim (8)
- Third-quarter 2026 production was 38.2 MBoe/d, up 10% from the second quarter and above the 33.3–36.8 MBoe/d guidance range. W&T Offshore third-quarter 2026 results release (8-K) · as of
- Free cash flow was $33.2 million, adjusted EBITDA $51.1 million, revenue $167.1 million and net loss $13.6 million after a $15.8 million derivative loss. W&T Offshore third-quarter 2026 results release (8-K) · as of
- Fourth-quarter 2026 production guidance is 32.0–35.3 MBoe/d and lease operating expense $65.4–72.3 million; about 2,600 Boe/d reflects Hurricane Isaias and a planned Mobile Bay turnaround. W&T Offshore third-quarter 2026 results release (8-K) · as of
- Unrestricted cash was $191.3 million, net debt $160.7 million (0.9 times trailing adjusted EBITDA) and total liquidity $234.7 million. W&T Offshore third-quarter 2026 results release (8-K) · as of
- Realised oil price was $85.06 per barrel before derivative settlements, down 14% from the second quarter. W&T Offshore third-quarter 2026 results release (8-K) · as of
- Adjusted earnings per share of $0.01 beat the $(0.05) estimate, and sales of $167.080 million beat the $143.480 million estimate. Company news, 30 October 2026 · as of
- West Texas Intermediate for December delivery settled at $86.85 a barrel, down 4.38%, and Brent for January settled at $92.57, down 5.85%. The Star (Malaysia), 10 November 2026 crude settlement report · as of
- Dividend of $0.01 per share payable 19 November 2026 to holders of record on 12 November 2026. W&T Offshore third-quarter 2026 results release (8-K) · as of
Sources
- W&T OFFSHORE INC - Form 8-K - FY2026 · sec.gov ·
- W&T Offshore Announces Third Quarter 2026 Results and Declares Dividend for Fourth Quarter of 2026 · mfn.se
- Crude futures settle lower · thestar.com.my ·
- Brent falls 1% on November 3 amid hopes for peace deals · nationthailand.com
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