Why Shares of Bill Barrett Corporation Shot Higher
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 Bill Barrett Corporation were bubbling higher today, gaining as much as 11% after notching three analyst upgrades this morning.
So what: The energy explorer and producer got a vote of confidence from Wells Fargo, Midtown Partners, and Mizuho, which lifted their ratings to "buy" or "outperform" after Bill Barrett's earnings report last week. Wells Fargo said the stock had lagged the market recently, but it believes it can deliver promising growth in the near term, while the other two analyst firms issued similar remarks about its rebound potential. Yesterday, Bill Barrett also got an upgrade from Stifel yesterday as it believes two of the company's territories being tested could add a value of $11.50 a share.
Now what: In its earnings report last week, Bill Barrett missed earnings estimates, with an adjusted net loss per share of $0.05 against estimates of an $0.08 per-share profit. Nonetheless, the company showed strong production gains as output in the Denver-Julesburg Basin and Powder Deep each improved by more than 100%. Today's upgrades seem to confirm that Bill Barrett is making progress despite lagging profits. Mizuho said it believed production and costs would improve throughout the year, among other catalysts that could push the stock higher. The company's balanced production of oil, natural gas, and natural gas liquids also gives it another advantage in a volatile energy market.
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