NEW YORK (TheStreet) -- Shares of Continental Resources (CLR - Get Report) are falling, sharply down 12.19% to $34.06 in midday trading on Monday, as investors continue to worry about a surplus of global supplies and weak demand as oil prices hit a fresh five-and-a-half year low, Reuters reports.
Data by the Energy Ministry showed that Russia's oil output hit a post-Soviet high last year with an average of 10.58 million barrels a day, higher by 0.7% due to small non-state producers, Reuters noted.
Still, the Organization of the Petroleum Exporting Countries has decided to maintain production output, choosing to let the market find its own level, Reuters added.
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Brent for February delivery is down 5.96% to $53.06 a barrel as of 11:42 a.m. ET, while WTI crude is also down, 4.63% to $50.25 a barrel today.
Continental Resources is an independent crude oil and natural gas exploration and production company operating throughout the U.S.
Two months earlier the Oklahoma City-based shale driller budgeted for $80 per barrel oil and planned to spend $4.6 billion in 2015.
Six weeks later Continental almost halved its 2015 budget, reducing to $2.7 billion for the year.
Separately, TheStreet Ratings team rates CONTINENTAL RESOURCES INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CONTINENTAL RESOURCES INC (CLR) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and a generally disappointing performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- CLR's very impressive revenue growth greatly exceeded the industry average of 6.7%. 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. This trend suggests that the performance of the business is improving. 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 ($2.83 versus $2.07).
- CLR's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 31.82%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- The debt-to-equity ratio of 1.20 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, CLR maintains a poor quick ratio of 0.75, which illustrates the inability to avoid short-term cash problems.
- You can view the full analysis from the report here: CLR Ratings Report