NEW YORK (TheStreet) -- Shares of Precision Drilling (PDS) - Get Precision Drilling Corporation Report , Canada's largest drilling rig contractor, closed down 12.5% to $4.83 on Wednesday as oil prices plunged further.
WTI crude was down 4.09% to $44.34 as of 4:15 p.m., while Brent crude was down 2.2% to $48.51, according to CNBC.
Oil prices, which have fallen more than 50% since June 2014, have fallen to their lowest point in nearly six years in recent weeks amid a global oversupply. The supply glut coupled with aggressive exploration and production from many of the world's largest oil companies and OPEC's unwillingness to cut production have held down oil prices.
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More than 5.4 million shares had changed hands Wednesday, compared to the daily average volume of 3,895,620.
Separately, TheStreet Ratings team rates PRECISION DRILLING CORP as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate PRECISION DRILLING CORP (PDS) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and attractive valuation levels. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 7.0%. Since the same quarter one year prior, revenues rose by 18.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- PRECISION DRILLING 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 year. During the past fiscal year, PRECISION DRILLING CORP increased its bottom line by earning $0.67 versus $0.17 in the prior year.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Energy Equipment & Services industry and the overall market, PRECISION DRILLING CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- PDS'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 39.21%, 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. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- You can view the full analysis from the report here: PDS Ratings Report