Why Halcon Resources Shares Tumbled

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 Halcon Resources (NYSE: HK  ) were flowing in the wrong direction today, falling as much as 15% after reporting earnings this morning.

So what: Results were mostly in line with estimates, as the shale explorer and producer delivered an adjusted EPS of $0.05 on expectations of $0.06. Without adjustments, however, profits were just $0.01 per share. Revenues, meanwhile, shot up more than 600%, in line with expectations, due to a variety of acquisitions. Lease operating expense also fell sharply by 47%.

Now what: The market seems to be excessively punishing Halcon for the earnings miss, which seems worse when looked at percentage-wise, as net income was about 20% below expectations. The market was perhaps expecting an earnings beat. That may look problematic, but the shale plays on which Halcon Resources are focused have serious growth potential. I wouldn't give up on Halcon just yet. You can keep track of all the latest developments by adding the company to your Watchlist here.


Read/Post Comments (1) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Add your comment.

DocumentId: 2405579, ~/Articles/ArticleHandler.aspx, 7/29/2014 7:29:58 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement