Why Abraxas Petroleum (AXAS) Stock Is Up Today

NEW YORK (TheStreet) -- Abraxas Petroleum (AXAS) was gaining 10.8% to $5.75 Tuesday after raising its third quarter production guidance.

The oil and gas company now expects to produce between 6,900 and 7,000 barrels of oil equivalent a day (boe/day) for the third quarter, up from its previous guidance of 6,500 to 6,700 boe/day for the quarter. Abraxas Petroleum lowered its expected operating costs for the quarter to between $12 and $13 a barrel from its previous expectations of between $13 and $14 a barrel.

Abraxas Petroleum also said its three wells in the North Fork prospect in North Dakota have been on production for an average of 27 days and each well produced 1,268 boe/day during that period.

Must Read: Warren Buffett's 25 Favorite Stocks

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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 some important positives, 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, solid stock price performance, expanding profit margins, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

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

  • AXAS's very impressive revenue growth greatly exceeded the industry average of 3.0%. Since the same quarter one year prior, revenues leaped by 56.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, AXAS's share price has jumped by 110.00%, exceeding the performance of the broader market during that same time frame. 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.
  • The gross profit margin for ABRAXAS PETROLEUM CORP/NV is currently very high, coming in at 74.78%. It has increased significantly from the same period last year. Along with this, the net profit margin of 9.04% is above that of the industry average.
  • Net operating cash flow has significantly increased by 110.21% to $27.03 million when compared to the same quarter last year. In addition, ABRAXAS PETROLEUM CORP/NV has also vastly surpassed the industry average cash flow growth rate of -5.00%.
  • ABRAXAS PETROLEUM CORP/NV has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. 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 ($0.50 versus $0.41).
  • You can view the full analysis from the report here: AXAS Ratings Report

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he and Stephanie Link think could be potentially HUGE winners. Click here to see the holdings for FREE.

If you liked this article you might like

16 Stocks to Own as the U.S. Economy's Expansion Turns 8 Years Old

16 Stocks to Own as the U.S. Economy's Expansion Turns 8 Years Old

Stocks Under $10 Portfolio: An Energy Play, a Rate Hike and Rebounding Markets

Stocks Under $10 Portfolio: An Energy Play, a Rate Hike and Rebounding Markets

Oil and Gas Companies Could Still Do Some Paring

Oil and Gas Companies Could Still Do Some Paring

These 7 Stocks Under $10 Are Making Big Moves Higher

These 7 Stocks Under $10 Are Making Big Moves Higher

7 Breakout Stocks Under $10 Set to Soar Higher

7 Breakout Stocks Under $10 Set to Soar Higher