Cabot Oil & Gas 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 Cabot Oil & Gas (NYS: COG) jumped 16% after the company released earnings.
So what: Revenue rose 17% to $262.1 million and adjusted earnings per share rose to $0.34 per share. Earnings were a penny short of estimates, but the market is cheering the company's expected production growth in 2012 of 45% to 55%.
Now what: One analyst from Howard Weil even thinks that growth "looks conservative," so Cabot could have more upside potential. Forward earnings estimates still put Cabot at a 30 times P/E ratio, so the price is still steep. I would like to see more actual results and falling costs, as opposed to rising costs this quarter before jumping on board.
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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 don't 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.