Range Resources Corporation Stock Buy Recommendation Reiterated (RRC)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK (TheStreet) -- Range Resources Corporation (NYSE:RRC) has been reiterated by TheStreet Ratings as a buy with a ratings score of B- . The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income, expanding profit margins, increase in stock price during the past year and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

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Highlights from the ratings report include:

• The revenue growth greatly exceeded the industry average of 1.1%. Since the same quarter one year prior, revenues rose by 32.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
• The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry average. The net income increased by 8.5% when compared to the same quarter one year prior, going from $51.29 million to $55.68 million.
• The gross profit margin for RANGE RESOURCES CORP is currently very high, coming in at 81.30%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 12.50% is above that of the industry average.
• The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
• RANGE RESOURCES CORP has improved earnings per share by 21.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, RANGE RESOURCES CORP reported lower earnings of $0.25 versus $0.55 in the prior year. This year, the market expects an improvement in earnings ($0.68 versus $0.25).

Range Resources Corporation operates as an independent natural gas, natural gas liquids (NGLs), and oil company. It engages in the acquisition, exploration, and development of natural gas and oil properties primarily in the Appalachian and southwestern regions of the United States. The company has a P/E ratio of 265.7, equal to the average energy industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Range has a market cap of $11.66 billion and is part of the basic materials sector and energy industry. Shares are up 14.1% year to date as of the close of trading on Monday.

You can view the full Range Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

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