What: Shares of SM Energy Co (NYSE:SM) jumped as much as 14% today after the company reported better-than-expected earnings.

So what: SM Energy's production jumped 23% to 16.5 million barrels of oil equivalent (BOE) and exceeded the company's operating plan. Growing production and lower lease costs resulted in adjusted net income of $33.2 million, or $0.49 per share, crushing the penny loss analysts had expected.  

Now what: While adjusted earnings exceeded expectations, it's worth noting that GAAP net loss was $57.5 million, or $0.85 per share, so operations aren't profitable without a number of adjustments the company is making. That's worth noting because operating profit per BOE fell 58% from a year ago to $13.65 and could fall further now that oil is below $50 per barrel. Operational improvements are nice, but this is still a stock that's tied to the price of oil long-term.

Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.