One Reason Continental Resources (CLR) Stock Is Gaining Today

NEW YORK (TheStreet) -- Shares of Continental Resources Inc. (CLR) are higher by 6.91% to $33.09 in early afternoon trading today, as the energy sector gets a boost from Spanish energy company Repsol SA's $8.3 billion agreement to acquire Talisman Energy (TLM) .

Additionally, light, sweet Brent crude for January delivery rose as high as 1.5% to $56.87 on the New York Mercantile Exchange on Tuesday, after hitting its lowest level in over five years, MarketWatch reports.

"We are starting to see a bottom here, and we are getting some value buying," an oil consultant with Frost & Sullivan told MarketWatch.

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The buying is likely coming from physical oil buyers, like refineries, which can store the oil purchased at the reduced prices. However, this kind of buying can come in waves and may not be enough to sustain a rally in prices, the consultant added.

Earlier in the day oil prices had dropped following the interest rate increase in Russia, and a continual slowdown in China's manufacturing sector, MarketWatch noted.

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Separately, TheStreet Ratings team rates CONTINENTAL RESOURCES INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate CONTINENTAL RESOURCES INC (CLR) 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, expanding profit margins, good cash flow from operations, impressive record of earnings per share growth and compelling growth in net income. 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:

  • CLR's very impressive revenue growth greatly exceeded the industry average of 6.3%. Since the same quarter one year prior, revenues leaped by 101.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • CONTINENTAL 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, CONTINENTAL RESOURCES INC increased its bottom line by earning $2.07 versus $2.03 in the prior year. This year, the market expects an improvement in earnings ($2.97 versus $2.07).
  • 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 218.5% when compared to the same quarter one year prior, rising from $167.50 million to $533.52 million.
  • The gross profit margin for CONTINENTAL RESOURCES INC is currently very high, coming in at 85.59%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 32.42% significantly outperformed against the industry average.
  • Net operating cash flow has slightly increased to $845.40 million or 2.90% when compared to the same quarter last year. In addition, CONTINENTAL RESOURCES INC has also modestly surpassed the industry average cash flow growth rate of -1.58%.
  • You can view the full analysis from the report here: CLR Ratings Report

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