NEW YORK (TheStreet) -- Shares of Cabot Oil & Gas (COG) - Get Cabot Oil & Gas Corporation Report are falling, sharply down 7.2% to $26.41 in late morning trading Wednesday, after the American Petroleum Institute reported that U.S. crude inventories surged by 12.7 million barrels last week, three times the estimated volume, adding to the global surplus, Reuters reports.
The excess global supplies, led by the U.S. shale boom, have been dragging oil prices down from about $110 a barrel between 2011 and 2013, while the Organization of the Petroleum Exporting Countries refuses to cut output to retain market share, Reuters added.
Brent crude for March delivery is down 0.99% to $49.11 a barrel as of 10:37 a.m. ET today, while WTI crude for March delivery is also down, 2.51% to $45.07 a barrel.
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Houston, TX-based Cabot Oil & Gas is an independent oil and gas company engaged in the development, exploitation and exploration of oil and gas properties.
Separately, TheStreet Ratings team rates CABOT OIL & GAS CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate CABOT OIL & GAS CORP (COG) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 6.7%. Since the same quarter one year prior, revenues rose by 17.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The debt-to-equity ratio is somewhat low, currently at 0.68, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.16, which illustrates the ability to avoid short-term cash problems.
- CABOT OIL & GAS CORP has improved earnings per share by 41.2% 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. We feel that this trend should continue. During the past fiscal year, CABOT OIL & GAS CORP increased its bottom line by earning $0.67 versus $0.31 in the prior year. This year, the market expects an improvement in earnings ($0.95 versus $0.67).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 44.2% when compared to the same quarter one year prior, rising from $69.89 million to $100.79 million.
- Net operating cash flow has increased to $358.30 million or 29.48% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -2.42%.
- You can view the full analysis from the report here: COG Ratings Report