Jan. 9 (Bloomberg) -- Ecopetrol SA fell to a three-year low as the oil producer planned to spend more this year to reach a lower-than-expected output target.
Colombia’s state-controlled oil company dropped 0.9 percent to 3,435 pesos at 2:52 p.m. in Bogota, the lowest on a closing basis since August 2010. Ecopetrol, the worst performer on the Colcap index in 2013 with a 32 percent drop, has fallen 7.2 percent this year.
The company said in a Dec. 13 regulatory filing that it raised its capital expenditure plan to $10.6 billion for 2014 to boost output to 819,000 barrels per day, less than the average estimate of 828,600 barrels among four analysts surveyed by Bloomberg. The stock has dropped amid concern that financing for the plan will include a dividend cut or an equity sale, according to Eric Conrads, a money manager who helps oversee $500 million of equities at ING Groep NV in New York.
“There are no short-term catalysts to justify adding to the name at current levels, and we perceive there is no real rush to buy it due to lack of top-line growth,” Conrads said in a phone interview. “The shares were pretty expensive before, and it’s adjusted but so have earnings after a couple of quarterly misses.”
The Bogota-based company said in a Dec. 20 regulatory filing that it may borrow about $1 billion next year to fund investments. It said it will use cash generation and sales of non-strategic assets to help pay for the plan.
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