Petroleum Development Shares Jumped: What You Need to Know
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 Petroleum Development Corp. (NAS: PETD) have rocketed 23% higher today on news of an expansion in oil exploration.
So what: The company announced today it was expanding in the liquid-rich Utica shale field by purchasing properties worth $50 million from multiple parties. The deal will add 30,000 net acres and the company may increase its leasehold to 80,000 to 100,000 acres by the end of next year.
Now what: Oil production from shale plays in the U.S. has risen dramatically in recent years and Petroleum Development is making a good move to expand its exposure. Now the focus turns to making these land holdings into profitable oil wells. I like the move, but would like to hear more details about what production will be like before getting too excited.
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At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.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.
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