Why Kodiak Oil & Gas (KOG) Stock Is Down Today

NEW YORK (TheStreet) -- Kodiak Oil & Gas (KOG) shares are falling, down -7.8% to $11.50 in after-market trading on Thursday, following the release of its first quarter earnings results.

The company posted a year over year quarterly revenue increase of 56% to $257 million, missing analysts consensus estimates of $272.2 million. 

The independent energy company reported net income of $29.1 million, or 11 cents per diluted share, missing analysts estimates by 7 cents.

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TheStreet Ratings team rates KODIAK OIL & GAS CORP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate KODIAK OIL & GAS CORP (KOG) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share, increase in net income, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • KOG's very impressive revenue growth greatly exceeded the industry average of 7.5%. Since the same quarter one year prior, revenues leaped by 103.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • KODIAK OIL & GAS CORP has improved earnings per share by 41.7% 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, KODIAK OIL & GAS CORP increased its bottom line by earning $0.53 versus $0.49 in the prior year. This year, the market expects an improvement in earnings ($0.85 versus $0.53).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Oil, Gas & Consumable Fuels industry average. The net income increased by 39.9% when compared to the same quarter one year prior, rising from $33.29 million to $46.57 million.
  • Net operating cash flow has significantly increased by 59.87% to $168.07 million when compared to the same quarter last year. In addition, KODIAK OIL & GAS CORP has also vastly surpassed the industry average cash flow growth rate of -22.86%.
  • The gross profit margin for KODIAK OIL & GAS CORP is currently very high, coming in at 78.97%. Regardless of KOG's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, KOG's net profit margin of 16.95% significantly outperformed against the industry.
  • You can view the full analysis from the report here: KOG Ratings Report
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