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What: Shares of Energen (NYSE:EGN) slumped more than 10% by 3:00 p.m. EST on Friday. A multitude of issues are weighing on the stock.

So what: The primary weight was Energen's fourth-quarter report, which was filled with bad news. While the company reported a profit of $0.27 per share, that was $0.11 per share less than analysts were expecting. Among the culprits were weak commodity prices, as well as the fact that the company's production came in below expectations due to a number of issues ranging from the weather to a weaker-than-expected oil rate.

Because of that weak report, as well as the persistent weakness in the oil market, Energen announced that it will discontinue paying a dividend. That's expected to help the company reduce its cash outflows so it can better manage the oil market downturn. Further, the company announced that it has decided to exit the San Juan Basin, and sell other non-core assets in the Delaware basin to bolster its balance sheet.

One of the reasons why Energen needs to bolster its balance sheet is because its credit rating has been downgraded three notches by Moody's, from Ba1 to B1. That moves its credit rating further below investment grade, going from non-investment grade speculative to highly speculative.

Energen was not the only oil company to see its credit rating slashed by the rating agency. Whiting Petroleum (NYSE:WLL), for example, saw the steepest cut, with its debt downgraded five notches from Ba2 all the way to Caa1, which means Whiting Petroleum has substantial credit risks. Energen is hoping to avoid joining Whiting Petroleum at that level, which is why it's suspending its dividend, and looking to sell assets.

Now what: Energen is doing what it can to manage through the current downturn in oil prices. It's having to make a lot of tough choices, and will have to continue to make tough choices until oil prices improve.

Matt DiLallo 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.