What: Shares of Unit Corporation (UNT) jumped as much as 30% today after the company announced a boost to its full-year guidance.
So what: Management said today that production growth for the oil and gas segment would be 6% to 8% for 2015, up from previous guidance of 2% to 4% growth. Capital expenditures are also expected to be about $30 million less than previously budgeted because of lower spending in oil and gas.
One of the positive notes came from a customer who wanted to terminate two BOSS drilling rig contracts early. The customer has apparently agreed to keep one rig, and the other rig is already contracted to a third-party operator.
Now what: This is a small ray of hope in a tough energy market right now, but I'd be cautious about getting too bullish today. Analysts aren't expecting anything near a profit in 2015, and even higher growth may not change that narrative. I'd like to see where net income stabilizes long-term before jumping in, because I think there's still a lot of turbulence ahead for oil and natural gas drillers.
