NEW YORK (TheStreet) -- Shares of Halcon Resources Corp. are down by 5.97% to $1.89 in mid-afternoon trading on Wednesday, as oil prices plummet today sending some stocks within the energy sector tumbling. Oil is lower today after the Energy Information Administration said that for the week ended April 3 U.S. crude stockpiles grew by 10.95 million barrels to a record 482.39 million. Halcon Resources is an independent energy company that focuses on acquiring, producing, exploring for and developing onshore liquids rich oil and natural gas assets in the U.S. Also pushing oil lower is Saudi Arabia's report that its output would likely stay at around 10 million barrels per day, after reporting a record high of 10.3 million barrels per day in March, Reuters reports. Crude oil (WTI) is lower by 6.22% to $50.62 per barrel and Brent crude is falling by 5.72% to $55.72 per barrel this afternoon, according to the CNBC.com index. Separately, TheStreet Ratings team rates HALCON RESOURCES CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation: "We rate HALCON RESOURCES CORP (HK) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, weak operating cash flow and generally disappointing historical performance in the stock itself." Highlights from the analysis by TheStreet Ratings Team goes as follows: The debt-to-equity ratio is very high at 2.11 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, HK maintains a poor quick ratio of 0.93, which illustrates the inability to avoid short-term cash problems. Net operating cash flow has decreased to $86.04 million or 15.90% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, HALCON RESOURCES CORP has marginally lower results. HK's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 61.60%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now. HALCON RESOURCES CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, HALCON RESOURCES CORP turned its bottom line around by earning $0.47 versus -$3.11 in the prior year. For the next year, the market is expecting a contraction of 106.4% in earnings (-$0.03 versus $0.47). Regardless of the drop in revenue, the company managed to outperform against the industry average of 19.8%. Since the same quarter one year prior, revenues fell by 16.3%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share. You can view the full analysis from the report here: HK Ratings Report Must Read: Warren Buffett's Top 25 Stocks for 2015
Click to view a price quote on HK. Click to research the Energy industry.
from Latest TSC Headlines http://ift.tt/1Fi0Aji
No comments:
Post a Comment