Image Source: EXCO Resources investor presentation

What: Shares of EXCO Resources (NYSE: XCO) ended up almost 18% yesterday after reporting a net loss for the quarter of ($0.24) per share, after adjusting for one time charges, the loss was a more modest ($0.03) per share.

So What: It's fair to say that the expectations for EXCO Resources, like so many other pure play oil and gas producers, were low heading into this quarter. According to consensus analyst estimates from S&P Capital IQ, EXCO was expected to lose ($0.07) on an adjusted basis. It appears that the market was happy that the company was able to jump over that low hurdle.

Another added bit of good news was that the company was able to reduce its total debt outstanding by $402 million compared to the third quarter while maintaining its total liquidity at $334 million. Any time that a company in the finanical situation like EXCO can lower its debt while leaving some borrowing capacity just in case things get worse, it deserves a little bit of love.

Now What: Anyone that already owns shares of EXCO should be slightly relieved to see yesterday's results, it suggests that it can stave off its creditors a little bit longer. While the market probably responded to this and increasing oil prices today, its important to remember that most of EXCO's revenue comes from natural gas, and prices for gas are still on the decline. EXCO's shares still have a long way to go to gain back all the losses over the past 5 years -- since 2011, shares are down 93% -- and with gas prices this low it's probably best for investors to wait this one out until EXCO has a more stable balance sheet.