NEW YORK (TheStreet) -- Shares of Continental Resources (CLR - Get Report) are lower 6.55% to $33.98 in afternoon trading on Thursday, as oil prices plunge on the global supply glut and strong dollar.
Although oil prices closed up on Wednesday, they dipped to their lowest level since March 2009 today.
Crude oil (WTI) is falling 2.56% to $42.19 per barrel this afternoon, and Brent crude is down 1.07% to $49.13 per barrel, according to the CNBC.com index.
A stronger dollar, which gained today after reports of strong retail sales and a tightening job market, has been weighing down commodities markets, MarketWatch reported.
"It's the first time the dollar has been able to gather some strength since the Chinese currency situation slapped us in the face. While dollar weakness may have served as support for crude oil in the last two days, it's coming back to haunt the market today," Robert Yawger, director of energy futures at Mizuho Securities told MarketWatch.
Additionally, Iraq, which is the Organization of the Petroleum Exporting Countries's second-largest producer, raised its production to a record-setting 4.2 million barrels per day last month, adding to concerns about the global supply glut, according to The Wall Street Journal.
Continental Resources is an independent crude oil and natural gas exploration and production company based in Oklahoma City, Okla.
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. Among the primary strengths of the company is its expanding profit margins over time. At the same time, however, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- CLR, with its decline in revenue, slightly underperformed the industry average of 34.8%. Since the same quarter one year prior, revenues fell by 35.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The gross profit margin for CONTINENTAL RESOURCES INC is rather high; currently it is at 65.60%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, CLR's net profit margin of -21.09% significantly underperformed when compared to the industry average.
- CONTINENTAL RESOURCES INC 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. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, CONTINENTAL RESOURCES INC increased its bottom line by earning $2.64 versus $2.07 in the prior year. For the next year, the market is expecting a contraction of 97.7% in earnings ($0.06 versus $2.64).
- The debt-to-equity ratio of 1.40 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, CLR has a quick ratio of 0.63, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, CONTINENTAL RESOURCES INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- You can view the full analysis from the report here: CLR Ratings Report