What about Repsol shares on the stock market?

The shareholders of the oil company Repsol are certainly concerned with the current state of their shares, since they have verified how in a short space of time their valuation has decreased by more than 25%. Because indeed, Its price has gone in 2015 from trading around 19 euros, to currently being worth 11 euros. There are many euros that have gone down the road, but the most worrying thing if you are currently a shareholder is that the losses may be even more acute in the coming months.

Repsol is one of the leading securities of the Spanish selective index, being one of the five blue chips that are integrated into the Ibex 35. And that is characterized by being one of the securities that have one of the most generous dividends on the Spanish stock market. With a profitability of almost 8%, made through two annual payments, which are collected in the months of June and December. Without a doubt, a good excuse to stay in value. But is it the only one? 

During 2015, the shares of the Spanish oil company have been among the most affected by the market, as a consequence of the fall in the prices of the main raw materials in international markets. The virulence of its collapse has surprised, not only its shareholders, but also a good part of the stock market analysts, where many of them even had them integrated into their portfolio of securities most recommended for clients.

Reasons for its stock market crash

This clearly bearish process that the company has been developing in recent months does not have a common denominator to explain it, but rather several and of a different nature. They must be analyzed, not only to determine the current strategy that you must undertake, you are positioned in the value, but also for if it can constitute a clear buying opportunity for the new shareholders who wish to take advantage of the low prices at which their shares are currently trading.

1. Oil dependency: the evolution of its prices is closely linked to that of crude oil. And in this sense, it has accompanied its listing almost always. This raw material has gone from trading 100 to 35 dollars a barrel, in a very short space of time. And how could it be otherwise, it has ended up affecting the national oil company. Not surprisingly, the entire sector has been heavily punished during this process, even with more aggressive corrections in other international companies that have lost 50% in a few months. In the opinion of analysts, as long as there is no recovery in the price of crude, there will be no possibility of some kind of rebound in Repspol's share prices. And that according to the latest information that the sector is generating, it does not seem that it will be its trend, at least in the short term.
2. Buy Talisman: the purchase of the Canadian oil company, now just a year ago, has excessively penalized the company's growth prospects. The reason is very clear, The operation was carried out with an oil price of around 100 dollars, while now it is worth much less, specifically 40, less than half that twelve months ago. As a result of the price set by the financial markets, the operation has not been profitable, and investors are progressively moving away from the company to seek other business opportunities, mainly in other stock market sectors.
3. Downtrend: its technical scenario cannot be more bearish, especially in the medium and long term. Since mid-2015 it developed a downward climb that took it up to its current prices. This trading process led to their actions until the important support of 10 euros, where at the moment it seems that it has endured its fall. However, if all market analysts agree on something, is that if you exceed these limits, your recovery will be very difficult to occur. What's more, they predict more pronounced depreciations that can take up to 7 or 8 euros per share. But in any case, they will be conditioned by the evolution of the barrel of crude. Some market experts are more positive with the value and predict that its price may lead to prices around 14 euros, where one of its main resistances is found.
4. Reduction in prices: Another variable that has against this value of the oil sector is that the most important brokers and financial intermediaries have severely lowered their target price. Going from an average of 20 euros to 14 per share. It would still have an upward path, but much more limited. Although the really important thing is that none of them have extended their listing targets. With this perspective, more than a few investment funds have removed the company from their securities portfolio, to the detriment of other companies that have the approval of the financial markets, and with greater possibilities of revaluation.

What can you do right now?

For a company as volatile as this, and whose short-term trend is so poorly defined, few strategies can be carried out. The gains they can obtain are very large, but the losses are also. Hence the latent danger of taking positions, at least until the path that their prices are going to take is clear.

During the last trading sessions, its course in the national continuous market has certainly been very erratic. As soon as it rises 2% in a trading session, as the next day it fell with the same intensity. There is, in short, a definite trend. It is only suitable if you are a trader, who wants to make your operations profitable in the same trading session, without looking at longer terms.

And generally with an evolution lower than that developed by the national selective index. From this stage, there are other much more advisable options if you want to generate capital gains in the shortest term, and from all sectors. Only its high dividend yield can play as an asset to make it of the most immediate appetite of your interests, and until its final scenario is clarified.

Repsol shares have clearly been one of the big losers in 2015, and over the next few months it will be necessary to check whether they recover positions, or if on the contrary, their prices follow the trend shown so far, and the severe falls they have developed continue .

In any case, In the current stock market offer you will always find companies with a better technical aspect, which are even developing powerful bullish patterns in their prices. Some of which are immersed in the unbeatable figure of free rise. The most advisable to buy on the stock market, and that can lead to significant capital gains in the operations that you face in equities for the next few months.

Six keys to define your position

If you want to obtain a certain return with the shares of this company, you will have no choice but to import a series of tips, which will help you achieve your goals. Not without difficulties in all your performances, and especially depending on the scenarios that arise from now on.

Another aspect that you must assess to carry out the operation successfully is the term of your investment. If it is going to be short-term, you can take advantage of possible cuts in their prices to try to get a few euros in each movement. If your perspectives, on the other hand, are for the medium or long term, the strategies will change significantly. Not surprisingly, the most appropriate in these cases is to formalize the purchase of shares when its long-haul trend has changed, going bullish from bearish.

At this time is trading under a very deep side channel, between 11 and 12,50 euros, from which it is difficult for him to leave. The investment strategy, according to the main stock market analysts, would be based on buying shares if it breaks the resistance, and on the contrary, selling them quickly if in the end it is decided to leave the channel for its bearish part.

To help you channel your operations in the value, we expose you some simple tips on how your operation should be, but especially in which variables you should look at to enter or exit the equity market through the shares of this company in the oil sector. With a view to setting up your portfolio of securities to face the 2016 financial year.

• If your term of stay is long, you will have every year a yield close to 8% in dividends, which will help you to enjoy a fixed income within the variable, and face certain personal expenses.
• In the event that you are tempted to enter the value, you should go to the crude oil price charts, which in large part will be the one that finally determines the evolution of your actions in the stock markets.
• You probably want to be positioned in a calm company, without excessive swings in their prices. In which case it will be more profitable for you to opt for other more defensive cutoff values that they do not make you be all day pending their quote.
• To protect your savings you can include it in your portfolio together with other less aggressive listed companies, and low an amount of the operation not excessively high.
• It has a very strong support at 10 euros, so that if it violates it, it will be better to get rid of its positions, and if you are not yet invested, the most reasonable thing is to wait for a better moment to enter the market.
• You must take into account the high level of indebtedness that this company has, and that will inevitably be a serious impediment for it to develop strong bullish movements that will take it to the maximums that it marked in previous years.