Why Abraxas Petroleum (AXAS) Stock Is Up Today

NEW YORK (TheStreet) -- Abraxas Petroleum (AXAS) was gaining 1.8% to $6.11 Wednesday after issuing an operations update on its Eagle Ford and Bakken assets.

The company said its three new wells in the Wiliiston Basin in North Dakota are currently producing a total of 2,845 barrels of oil equivalent a day.  

Abraxas also said a recently completed well in Texas is "flowing to sales at encouraging rates." The company is currently drilling a third well in Eagle Ford.

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TheStreet Ratings team rates ABRAXAS PETROLEUM CORP/NV as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate ABRAXAS PETROLEUM CORP/NV (AXAS) a BUY. This is driven by multiple 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, notable return on equity, expanding profit margins, solid stock price performance and impressive record of earnings per share growth. 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 22.1%. 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 400.00% and other important driving factors, this stock has surged by 205.39% 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, AXAS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • ABRAXAS PETROLEUM CORP/NV 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, ABRAXAS PETROLEUM CORP/NV turned its bottom line around by earning $0.41 versus -$0.20 in the prior year. This year, the market expects an improvement in earnings ($0.42 versus $0.41).
  • 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 690.6% when compared to the same quarter one year prior, rising from $0.60 million to $4.70 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, ABRAXAS PETROLEUM CORP/NV's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: AXAS Ratings Report

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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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