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Why Hold Strategy is Apt for Callon Petroleum (CPE) Stock Now
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Callon Petroleum Company is likely to see earnings growth of 70.8% and 2.9% in 2022 and 2023, respectively.
What’s Favoring the Stock?
West Texas Intermediate crude price, trading at more than $70 per barrel, is still highly favorable for exploration and production activities.
Being a leading exploration and production company, Callon Petroleum is well-positioned to capitalize on handsome crude prices. The firm, carrying a Zacks Rank #3 (Hold), has a strong footprint in Permian, the most prolific basin in the United States, brightening its production outlook. In the top-tier Permian and Eagle Shale portfolio, Callon Petroleum has identified roughly 15 years of high-return drilling inventory, brightening its production outlook.
CPE is also focused on greenhouse gas emissions and lowering routine flaring. The new targets of Callon Petroleum also comprise strengthening its financials while deleveraging the balance sheet.
Risks
As compared to the 2.85% dividend yield of the composite stocks belonging to the industry, Callon Petroleum’s yield is 0%. Also, rising lease operating expenses are hurting its bottom line.
To make its operations more stable, Phillips 66 is giving more attention to midstream (pipelines), renewables and chemicals businesses. It also has strong refining operations.
Precision Drilling Corporationis a well-known name in the energy space for offering its clients access to an extensive fleet of Super Series drilling rigs. Precision’s services also include offering well service rigs. With high commodity prices, demand for PDS’ drilling rigs is favorable.
NexTier Oilfield Solutionsis also a well-known U.S. land oilfield service player. With higher exploration and production by upstream companies, demand for NexTier Oilfield’s diverse set of well completion and production services is handsome.
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Why Hold Strategy is Apt for Callon Petroleum (CPE) Stock Now
Callon Petroleum Company is likely to see earnings growth of 70.8% and 2.9% in 2022 and 2023, respectively.
What’s Favoring the Stock?
West Texas Intermediate crude price, trading at more than $70 per barrel, is still highly favorable for exploration and production activities.
Being a leading exploration and production company, Callon Petroleum is well-positioned to capitalize on handsome crude prices. The firm, carrying a Zacks Rank #3 (Hold), has a strong footprint in Permian, the most prolific basin in the United States, brightening its production outlook. In the top-tier Permian and Eagle Shale portfolio, Callon Petroleum has identified roughly 15 years of high-return drilling inventory, brightening its production outlook.
CPE is also focused on greenhouse gas emissions and lowering routine flaring. The new targets of Callon Petroleum also comprise strengthening its financials while deleveraging the balance sheet.
Risks
As compared to the 2.85% dividend yield of the composite stocks belonging to the industry, Callon Petroleum’s yield is 0%. Also, rising lease operating expenses are hurting its bottom line.
Stocks to Consider
Better-ranked players in the energy space include Phillips 66 (PSX - Free Report) , Precision Drilling Corporation (PDS - Free Report) and NexTier Oilfield Solutions Inc. . All the stocks carry a Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
To make its operations more stable, Phillips 66 is giving more attention to midstream (pipelines), renewables and chemicals businesses. It also has strong refining operations.
Precision Drilling Corporationis a well-known name in the energy space for offering its clients access to an extensive fleet of Super Series drilling rigs. Precision’s services also include offering well service rigs. With high commodity prices, demand for PDS’ drilling rigs is favorable.
NexTier Oilfield Solutionsis also a well-known U.S. land oilfield service player. With higher exploration and production by upstream companies, demand for NexTier Oilfield’s diverse set of well completion and production services is handsome.