Back to top

Analyst Blog

Independent energy company, Harvest Natural Resources Inc. (HNR - Snapshot Report), has entered into exclusive talks to sell its outstanding shares to Pluspetrol Venezuela S.A. for a consideration of approximately $373 million.

The deal is an outcome of the company’s inability to keep up with the struggles of financing its exploration activities. The consideration would include the company’s long-term debt of $76.1 million (as of Jun 30) as well as other obligations.
Argentina’s Pluspetrol is expected to hold onto Harvest’s 32% stake at Petrodelta S.A., a joint venture between Harvest and state-owned Petroleos de Venezuela SA. The remaining non-Venezuelan assets would be spun-off to form a new company, SpinCo, subject to approval from the government and Harvest shareholders.

SpinCo will comprise the company’s assets in Gabon, Indonesia, Colombia, and China and will be governed by the company’s current management. While the stake at Petrodelta has not been fruitful for Harvest, its interests at Utah, Gabon and Indonesia have been quite successful.

Post announcement, shares of Harvest were up 26.5% to $5.25 when the market closed on Sep 11.  

The financials look bleak with Harvest reporting second quarter loss of 11 cents per share wider than the Zacks Consensus Estimate of a loss of 7 cents per share. The company also reported a net loss of $4.5 million with loss from operations increasing 31.8% y-o-y.

However, the company’s global exploration portfolio is a positive. Moreover, management plans to generate sufficient funds for its current projects and enhance the value of its assets to benefit shareholders.

Harvest is an exploration and production company (E&P) that has its principal operations in Venezuela and Russia. The company’s main focus rests on exploration, acquisition and development of oil and gas fields.

Harvest currently retains a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next 1 to 3 months.

Meanwhile, one can consider other energy explorers such as Range Resources Corporation (RRC - Analyst Report), Matador Resources Company (MTDR - Snapshot Report) and Carrizo Oil & Gas Inc. (CRZO - Snapshot Report) as good investment opportunities. All these stocks currently sport a Zacks Rank #1 (Strong Buy).  

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
PLANAR SYST… PLNR 4.44 +5.21%
BITAUTO HOL… BITA 81.71 +5.12%
CTPARTNERS… CTP 16.66 +4.26%
CHINA BIOLO… CBPO 47.91 +3.30%
MALLINCKROD… MNK 72.94 +2.85%