The Santos Ltd (ASX: STO) share price has been treading lower in recent times.
When the company reported its half-year result on 17 August, its shares fell to a new year-to-date low of $5.84. This erased all the gains made over the past 8 months, with Santos shares now down around 5% in 2021.
Yesterday, the Santos share price ended the day at $6.19. It has again fallen in early trade today, down 1.53% to $6.09. In comparison against pre-pandemic levels, Santos shares are down more than 30% from the $9 mark achieved during January 2020.
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What's in store for Santos in the second half of FY21?
Santos provided some context for its full-year outlook for the 2021 financial year.
The company is maintaining its sales volume guidance of between 100 mmboe (million barrels of oil equivalent) to 105 mmboe.
Production guidance on the other hand is forecast to be in the range of 87 mmboe to 91 mmboe. The lower second-half production volumes are due to the 25% sell-down in Bayu-Undan and DLNG which was completed in April.
Furthermore, the Santos and Oil Search Ltd (ASX: OSH) merger process is currently underway. Due diligence is being conducted with a binding merger implementation deed targeted for 13 September. Shareholders are due to vote on the proposal in November.
Where next for the Santos share price?
While it seems like a busy second half for the company, a couple of brokers weighed in on the Santos share price.
Analysts at JPMorgan cut its price target by 1.2% to $8.05 for Santos shares. Leading Australian investment house Morgans followed suit, reducing its rating by 0.6% to $8.55 per share.
In addition, Goldman Sachs released a report stating that Santos' half-year result was in line with market expectations.
The multinational broker noted: "Potential for further capital recycling through farm-ins/sell downs as Santos executes on its growth pipeline could be incrementally positive. Santos is leveraged to continued upside risk in oil prices."
Despite the update, Goldman Sachs remained unrated on Santos shares.
Quick summary on Santos shares
Over the past 12 months, the Santos share price has gained just over 20%, which is in line with the S&P/ASX 200 Index (ASX: XJO), up 25%.
Santos commands a market capitalisation of roughly $12.8 billion, with approximately 2 billion shares on its registry.
