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Kodiak Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Kodiak Oil & Gas (AMEX: KOG  ) sank as much as 10.5% in intraday trading today as a Chinese rate hike and a strengthening dollar sent energy prices down.

So What: While small caps like Kodiak, ATP Oil & Gas (NYSE: ATPG  ) , and Stone Energy are getting smacked rather hard, energy stocks of all sorts have sold off. Big oil giants ExxonMobil (NYSE: XOM  ) , Chevron (NYSE: CVX  ) , and ConocoPhillips (NYSE: COP  ) are all down more than 2%, while oil service stocks Weatherford (NYSE: WFT  ) and Halliburton (NYSE: HAL  ) are down 7.5% and 3.5%, respectively.

Now What: China's surprise tightening has certainly raised concerns about global energy demand, but I'd use today's sell-off as an opportunity to nibble. Kodiak, in particular, remains a financially strong, up-and-coming play on the Bakken Shale, with an expected year-end exit rate of 2,500 barrels of oil equivalent per day. Of course, given the company's small size, Fools would do well to buy it in a group of bigger, more established producers.

Interested in more info on Kodiak? Add it to your watchlist by clicking here.

Fool contributor Brian Pacampara doesn't own a position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.

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  • Report this Comment On October 20, 2010, at 10:42 AM, superchipmunk wrote:


    Press Release Source: Kodiak Oil & Gas Corp. On Tuesday October 19, 2010, 6:14 pm EDT

    DENVER, Oct. 19 /PRNewswire-FirstCall/ -- Kodiak Oil & Gas Corp. (NYSE Amex: KOG), an oil and gas exploration and production company with assets in the Williston Basin of North Dakota and Montana and in the Green River Basin of southwest Wyoming, today announced that it has entered into a definitive purchase and sale agreement with a private oil and gas company to acquire high-working-interest, contiguous Bakken/Three Forks Williston Basin leasehold and producing properties.

    Price: 4, Change: +.19, Percent Change: +4.99%

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