|Bid||30.92 x 1200|
|Ask||30.95 x 3000|
|Day's Range||30.27 - 31.04|
|52 Week Range||28.49 - 71.95|
|Beta (3Y Monthly)||1.75|
|PE Ratio (TTM)||12.38|
|Earnings Date||Oct 28, 2019 - Nov 1, 2019|
|Forward Dividend & Yield||0.20 (0.67%)|
|1y Target Est||51.78|
(Bloomberg Opinion) -- When the market doesn’t go your way, there’s a certain deflective comfort to be found in blaming the market. The slump in energy stocks has spurred some talk of getting out of public markets altogether – even as one company, Saudi Aramco, is apparently considering finally taking a giant plunge into them. Conflicting signals, yes, but united in one important aspect. Harold Hamm, CEO of fracker Continental Resources Inc., was asked on the latest earnings call what value there was in the company remaining public. The stock has fallen by more than half since last October to about $30, while the consensus target is about $51, according to figures compiled by Bloomberg. Hamm responded he didn’t see a lot of value in it “in today’s market,” and the analyst commiserated on the herd’s apparent short-sightedness, saying “there’s clearly something broken there.”Over in the power sector, Vistra Energy Corp.’s CEO, Curtis Morgan, fielded a similar question for similar reasons. While professing “faith” in public markets, he added that going private must be considered if the stock’s perceived discount doesn’t ultimately close.There are specific reasons why this question was asked of these two companies. Hamm owns almost 77% of Continental anyway, so the free float is currently valued at just $2.8 billion. Vistra, meanwhile, has private equity deep in its DNA, being one piece resulting from the 2007 buyout of TXU Corp. and run by an alumnus of Energy Capital Partners LLC.Public markets aren’t paragons of rationality, with the wisdom of the crowd repeatedly giving way to the mania of the mob. But it’s tough to argue the market is “broken” here. After all, if it’s irrational now, then wasn’t that also the case five years ago, when Continental traded at about $80 just as oil prices began to slip? Recall the company sold its hedging book around that time, ditching its insurance against an oil crash, with Hamm in November 2014 telling, coincidentally, the same analyst:… We feel like we're at the bottom rung here on the [oil] prices and we'll see them recover pretty drastically, pretty quick.Clearly, there isn’t a public-market monopoly on getting stuff wrong.The private market has its own checkered record in energy. There have been obvious blowups, such as KKR & Co. Inc.’s forays with Samson Resources Corp. and, of course, TXU. Vistra’s sector, merchant generation, has a long history of keeping bankruptcy judges busy, which is precisely why it’s one of only two public companies left – and why both are diversifying into more stable retail operations.Continental and Vistra have sold off for similar and quite rational reasons. Oil and gas prices are in the tank, and forecasts for Continental’s earnings take their cue from that. Similarly, as expectations of a hot and profitable summer in the Texas power market have cooled off, so Vistra’s stock has dropped with power futures.This cuts both ways, and investors with a bullish view on energy prices are free to swoop in. They haven’t. That may reflect such ordinary things as fear of a recession, but I think it has more to do with a deterioration in one longstanding reason to own energy stocks: gaining exposure to the underlying commodity.Chalk it up to a mixture of hindsight and foresight. Investors have noticed, especially with E&P companies, that past windfalls generated by price rallies tended to accrue to drilling budgets and executive compensation instead of them. Looking ahead, fundamental shifts in the energy market – from shale to renewables to peak demand forecasts to trade wars – inject volatility and raise doubts about long-term pricing. Rather than put a big multiple on future earnings tied to commodity prices and growth, investors prioritize near-term free cash flow that can underpin dividends – show me the money, in other words.You can see this in E&P valuation multiples. Traditionally, these swung low when oil prices were very high, in anticipation of an inevitable cyclical downswing, and rose when prices fell, pricing in the next recovery. In this latest cycle, however, that relationship has changed. When oil prices fell sharply in 2015 and 2016, valuation multiples soared (and equity issuance spiked). But when oil dropped in late 2018 and this summer, multiples fell alongside it.Similarly, while Bloomberg NEF reports Texas’ wholesale electricity market is the tightest it’s been since the lucrative summer of 2011, investors aren’t paying up for the option in Vistra’s stock. That may be a trust thing, in part, as the timetable for deleveraging set by Vistra when it bought Dynegy Inc. has slipped. But it also reflects the quite reasonable concern that new renewable capacity, especially solar power, could loosen Texas’ electricity market quite quickly – as has happened in the past.The higher risks around energy earnings and damaged trust means investors demand more to buy into them – meaning a higher cost of capital expressed in lower valuations.Herein lies a lesson for Saudi Arabian Oil Co., to give it its full name. The seemingly endless saga of Aramco’s IPO has been dogged by the $2 trillion market-cap target voiced by Prince Mohammed Bin Salman in 2016. As I wrote here, that number reflected a simplistic valuation of Aramco’s vast reserves, even though today’s oil investors prioritize dividends partly because they suspect barrels not due to be produced for another few decades may never see the light of day. Just like earnings streams for Continental and Vistra, the benefit of the doubt, expressed as a high multiple, has diminished.Talk of an Aramco IPO was revived, somewhat jarringly, in the same week Saudi officials were trying to talk up sagging oil prices. Maybe the IPO talk remains just that, but it could also mean Saudi Arabia may actually go ahead, even if that finally buries the $2 trillion fantasy. Facing chronic deficits, Riyadh could use the money; and, as cynics often contend, the public market is where the dumb – that is, cheap – money is to be found. The one catch is that, when it comes to energy, the dumb money looks a little wiser these days.To contact the author of this story: Liam Denning at email@example.comTo contact the editor responsible for this story: Mark Gongloff at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Continental Resources has lost around US$15 billion of its market capitalization since October 2018, shedding more than half of its value as investors are losing faith
OKLAHOMA CITY, Aug. 7, 2019 /PRNewswire/ -- Continental Resources, Inc. (CLR) ("Continental" or the "Company") announced today that it will redeem $500 million in aggregate principal amount, representing approximately 31% of the $1.6 billion in aggregate principal amount currently outstanding, of its 5% Senior Notes due 2022 (the "Notes") on September 12, 2019, the redemption date for the Notes. The redemption price for the Notes called for redemption will be equal to 100.833% of the principal amount, plus accrued and unpaid interest, if any, to, but excluding, the redemption date in accordance with the terms of the Notes and the indenture under which the Notes were issued. The Notes to be redeemed will be selected in accordance with the procedures of The Depository Trust Company.
(Bloomberg) -- It’s such a bad time to be a publicly traded oil company that Harold Hamm, the billionaire founder and chief executive officer of Continental Resources Inc., was asked whether it’s still worth it.“In today’s market, we don’t see a lot of value in it,” Hamm said Tuesday on the company’s earnings conference call, in response. “But we can’t control the market. We can control what we’re dealing with here on a daily basis, and that’s what we’re doing.”Hamm, 73, who owns 76.57% of Continental, has seen the company shed about $15 billion of its market capitalization since October. It’s now valued at less than $12 billion.Shares of shale producers have taken a beating in recent months as investors grow increasingly impatient with the sector’s track record of burning cash without producing enough returns. The S&P index of independent explorers has tumbled 51% since early October.In little more than three months, Hamm’s net worth has shrunk by roughly $3 billion, to about $9.4 billion, data compiled by Bloomberg show.But Hamm said the latest share buyback program by his Oklahoma City-based company, which focuses on the Bakken shale of North Dakota, isn’t aimed at going private. Rather, the goal is to purchase stock that’s undervalued, he said.“We believe the buyback coupled with dividends and capital discipline, which we’ve exhibited for a long time, will ultimately return value to where it should be fairly traded,” Chief Financial Officer John Hart said on the call.Shares of Continental briefly spiked above $32 shortly after Hamm’s comments, but pared gains to close 0.3% lower at $31.46 in New York.To contact the reporter on this story: David Wethe in Houston at email@example.comTo contact the editors responsible for this story: Simon Casey at firstname.lastname@example.org, Carlos CaminadaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Oil prices have had a tough start to the week as the trade war between China and the U.S. intensified and the Treasury Department labelled China a currency manipulator
Independent shale producer Continental Resources on Tuesday said it will decrease the number of rigs it operates in Oklahoma to 12 from 19 this year, citing improved productivity. "The key thing here is it emphasizes the efficiency gains we've received from our rigs," Continental President Jack Stark said during an earnings call with investors. U.S. shale production has climbed to record levels, even as oil companies are running fewer rigs.
Continental Resources (CLR) delivered earnings and revenue surprises of -1.67% and 3.63%, respectively, for the quarter ended June 2019. Do the numbers hold clues to what lies ahead for the stock?
Continental Resources earnings missed but the shale giant boosted its production outlook, while falling crude oil prices force other companies to pull back.
Increasing Shareholder Returns through Share Repurchases & Dividend 2019 Production Guidance Increased; LOE and G&A Expense Guidance Decreased - Releasing 7 Rigs in the South by Year-End 2019 Due to Springer ...
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The event is EnerCom's 24th annual Denver investment conference. At this year's conference, c-level leadership of leading oil and gas companies will present their plans for drilling and completing wells, discuss well results and capital efficiency, and estimate capital expenditures and production for the balance of 2019 and into 2020.
Lagoon and Continental enter long-term deal for water gathering, disposal, recycling and sourcing OKLAHOMA CITY , July 31, 2019 /PRNewswire/ -- Lagoon Water Solutions; Oklahoma's premier water midstream ...
OKLAHOMA CITY, July 31, 2019 /PRNewswire/ -- Continental Resources, Inc. (CLR) ("Continental" or the "Company") today announced the sale of its eastern STACK water gathering and recycling system in Blaine County, Oklahoma for $85 million to Lagoon Water Solutions ("Lagoon"). Along with the divestiture, Continental has entered into a long-term arrangement with Lagoon to provide water sourcing, gathering and disposal services for Continental's future development in the area. Continental owns and operates three additional water infrastructure systems in Oklahoma, as well as ten additional systems in the Bakken.
Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is...
Earnings Conference Call Scheduled for Tuesday, August 6, 2019 at 12:00 p.m. ET OKLAHOMA CITY , July 9, 2019 /PRNewswire/ -- Continental Resources, Inc. (NYSE: CLR) (the Company) plans to announce second ...
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