NEW YORK (TheStreet) -- Shares of Warren Resources Inc. (WRES) are up 3.34% to $6.37 after it announced it agreed to acquire essentially all of the Marcellus shale assets of Citrus Energy Corporation and two additional working interest owners for $352.5 million.
The Marcellus Shale adds a core area to Warren's existing California oil and Wyoming energy assets as it produced approximately 82 million net cubic feet per day of natural gas, as of June.
Separately, TheStreet Ratings team rates WARREN RESOURCES INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate WARREN RESOURCES INC (WRES) a BUY. This is driven by several positive factors, 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 revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 3.2%. Since the same quarter one year prior, revenues rose by 11.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Powered by its strong earnings growth of 175.00% and other important driving factors, this stock has surged by 129.85% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, WRES should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- WARREN RESOURCES INC 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. We feel that this trend should continue. During the past fiscal year, WARREN RESOURCES INC increased its bottom line by earning $0.42 versus $0.21 in the prior year. This year, the market expects an improvement in earnings ($0.48 versus $0.42).
- 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 190.2% when compared to the same quarter one year prior, rising from $2.83 million to $8.21 million.
- The gross profit margin for WARREN RESOURCES INC is currently very high, coming in at 70.57%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 24.00% significantly outperformed against the industry average.
- You can view the full analysis from the report here: WRES Ratings Report