Is Comstock Resources Inc. (NYSE:CRK) cheap but dangerous?


Comstock Resources Inc. (NYSE:CRK) said its revenue at the end of the latest quarter were 53.8M%, up 0.31%% from a corresponding period a year earlier.

Since Comstock Resources Inc. incurred expenses of $43.92M to generate the revenue, its gross income in the quarter was $9.88M. After deducting other operating expenses such salaries from the gross income, it ended up with a net income that gave it EPS of $(1.61).

Recently, Comstock Resources, Inc. (NYSE:CRK) reported first-quarter 2017 loss of $1.75 per share (excluding one-time items), narrower than the Zacks Consensus Estimate of a loss of $1.86. The better-than-expected results were driven by improved oil and gas prices, increased revenues and reduced operating expenses. In particular, oil and natural gas prices moved up 84% and 60%, respectively, compared to the year-ago quarter providing an impetus to the finances of the company. Further, Comstock’s quarterly loss significantly narrowed from the year-ago adjusted loss of $5.60 per share.

Let’s look into the technical of the stock

The Barchart Technical Opinion rating is a 100% Sell and ranks in the Top 1% of all short term signal directions. Longer term, the trend strength is in the Top 1%. Long term indicators fully support a continuation of the trend. The market is in highly oversold territory. Beware of a trend reversal.

The reported EPS resulted from dividing the net income with the number of outstanding shares. Investors should keep in mind that Comstock Resources Inc. finished the quarter with diluted outstanding shares of 14.23M.

For the next quarter, though, the analysts on Wall Street are expecting EPS of $-1.25 from Comstock Resources Inc..

Comstock Resources Inc. finished the most recent quarter with a cash balance of 30.44M%. It generated net cash flow of $3.21M from operations, yielding free cash flow of $(35.19M) for the quarter.

With that, the company concluded the quarter with total assets worth $865.99M. It also reported total debt of -%, with the debt having increased/decreased by falling from the previous quarter. Comstock Resources Inc. booked total liabilities of $1.15B in the latest quarter.

Analysts who have commented on Comstock Resources Inc. so far have an average recommendation of Overweight on its stock. What does that mean? A recommendation in the range of 1.00 – 1.24 indicates that a stock is a BUY. A recommendation in the band of 1.75 – 2.24 suggests a stock is a HOLD, and a recommendation in the range of 2.75 – 3.00 implies a stock is a SELL. So that tells you the perception of Comstock Resources Inc. on Wall Street.

However, outside BUY, HOLD and SELL, other available analyst recommendations are OVERWEIGHT and UNDERWEIGHT, represented by numbers in the range of 1.25 – 1.74 and 2.25 -2.74, respectively.

Analysts on the average are also predicting that shares of Comstock Resources Inc. will be trading at $12.31 in the next 12 months.