Why Gulfport Energy Shares Plunged
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 oil and gas company Gulfport Energy (NAS: GPOR) fell as much as 15% in trading today after the company reported earnings.
So what: Gulfport reported that production increased 24% from last year to 7,089 barrels of oil equivalent per day and net income rose 27% to $26.7 million, or $0.48 per share. But analysts and investors thought the company would generate $0.60 per share in earnings, so the company didn't live up to expectations this quarter.
Now what: Management expects production to increase to an average of 7,923-8,470 barrels of oil equivalent per day for the full year, which is expected to bring a steady rise in earnings. Even after this quarterly miss, Gulfport has been a fairly steady producer and trades at just 8.2 times 2012 earnings estimates. I think this gives investors a nice discount and shares will improve from here as production increases.
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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.Motley Fool newsletter services have recommended buying shares of Gulfport Energy. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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