Continental Resources Inc. (CLR) Clearly Signals Buy-Into the Stock: Don’t ignore the signals

Continental Resources Inc. (NYSE: CLR) stock fell -2.75% on Friday to $65.09 against a previous-day closing price of $66.93. With 1.11 million shares changed hands, the volume of the stock remained lighter than its average volume of 1.81 million shares. During the session, the Oil & Gas E&P company that operates in wider Energy sector, reached to the highest price of $67.05 whereas the lowest price it dropped to was $64.79. The 52-week range on CLR shows that it touched its highest point at $75.49 and its lowest point at $32.15 during that stretch. It currently has a 1-year price target of $74.71. With its current market cap of 23.03 billion, CLR has annualized dividend of $1.12 while the current yield stands at 1.72%. Beta for the stock currently stands at 2.56.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of CLR was down-trending over the past week, with a drop of -3.23%, but this was up by 3.12% over a month. Three-month performance surged to 7.84% while six-month performance rose 18.17%. The stock gained 98.26% in the past year, while it has gained 45.42% so far this year. A look at the trailing 12-month EPS for CLR yields 5.50 with Next year EPS estimates of 10.79. For the next quarter, that number is 3.33. This implies an EPS growth rate of 376.10% for this year and -13.13% for next year. EPS is expected to grow by 13.85% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 44.10%.

Float and Shares Shorts:

At present, 357.57 million CLR shares are outstanding with a float of 51.46 million shares on hand for trading. On Jul 14, 2022, short shares totaled 3.83 million, which was 1.06% higher than short shares on Jun 14, 2022. In addition to Mr. Harold G. Hamm LLM as the firm’s Founder & Non Exec. Chairman, Mr. William B. Berry B.Sc., M.Sc. serves as its Pres, CEO & Director.

Institutional Ownership:

Through their ownership of 12.74% of CLR’s outstanding shares, institutional investors have minority control over the company. Other institutions hold 62.50% of CLR, in contrast to 6.66% held by mutual funds. Shares owned by individuals account for 5.94%. As the largest shareholder in CLR with 1.99% of the stake, Smead Capital Management, Inc. holds 7,235,205 shares worth 7,235,205. A second-largest stockholder of CLR, The Vanguard Group, Inc., holds 4,129,650 shares, controlling over 1.14% of the firm’s shares. SSgA Funds Management, Inc. is the third largest shareholder in CLR, holding 3,023,689 shares or 0.83% stake. With a 1.71% stake in CLR, the Smead Value Fund is the largest stakeholder. A total of 6,217,971 shares are owned by the mutual fund manager. The SPDR S&P Oil & Gas Exploration &, which owns about 0.46% of CLR stock, is the second-largest Mutual Fund holder. It holds 1,662,446 shares valued at 108.64 million. Vanguard Total Stock Market Index holds 0.44% of the stake in CLR, owning 1,609,618 shares worth 105.19 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CLR since 25 analysts follow the stock currently. There are 2 analysts who recommend BUY ratings, while 4 suggest SELL ratings. Of the remaining analysts, 17 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With CLR analysts setting a high price target of $93.00 and a low target of $64.00, the average target price over the next 12 months is $74.09. Based on these targets, CLR could surge 42.88% to reach the target high and fall by -1.67% to reach the target low. Reaching the average price target will result in a growth of 13.83% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. CLR will report FY 2022 earnings on 02/13/2023. Analysts have provided yearly estimates in a range of $17.84 being high and $10.46 being low. For CLR, this leads to a yearly average estimate of $12.51. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Continental Resources Inc. surprised analysts by $0.25 when it reported $3.47 EPS against a consensus estimate of $3.22. The surprise factor in the prior quarter was $0.22. Based on analyst estimates, the high estimate for the next quarter is $4.52 and the low estimate is $2.41. The average estimate for the next quarter is thus $3.24.

Summary of Insider Activity:

Insiders traded CLR stock several times over the past three months with 5 Buys and 0 Sells. In these transactions, 24,281 shares were bought while 0 shares were sold. The number of buy transactions has increased to 38 while that of sell transactions has risen to 31 over the past year. The total number of shares bought during that period was 140,885,637 while 408,974,034 shares were sold.

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