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 Abraxas Petroleum Corp. (NASDAQ: AXAS ) jumped 12% today after the company announced an operational update.
So what: Management increased its 2014 production guidance from a range of 5,200-5,300 barrels of oil equivalent per day to 5,500-5,700 Boepd. The increase comes from three additional planned wells, which will increase capital expenditures this year by $35 million to $160 million.
Now what: Shares were already trading at 10.6 times forward earnings before the update, so there's further upside given this operational success. Management also doesn't expect operational costs per barrel to increase because of the new production, so that provides leverage for Abraxas. Given the solid production numbers, I think shares still have room to run, especially because big oil is cutting back on capital spending, so oil prices should remain high.
Do you know this energy tax "loophole?"
You already know record oil and natural gas production is changing the lives of millions of Americans. But what you probably haven't heard is that the IRS is encouraging investors to support our growing energy renaissance, offering you a tax loophole to invest in some of America's greatest energy companies. Take advantage of this profitable opportunity by grabbing your brand-new special report, "The IRS Is Daring You to Make This Investment Now!," and you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.
RSS Headlines
Fool UK
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 icon found on every comment.
Be the first one to comment on this article.