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

Comstock Resources Inc. (NYSE: CRK) stock fell -2.00% on Tuesday to $12.76 against a previous-day closing price of $13.02. With 2.37 million shares changed hands, the volume of the stock remained lighter than its average volume of 3.6 million shares. During the session, the Oil & Gas E&P company that operates in wider Energy sector, reached to the highest price of $13.15 whereas the lowest price it dropped to was $12.56. The 52-week range on CRK shows that it touched its highest point at $22.11 and its lowest point at $6.88 during that stretch. It currently has a 1-year price target of $19.36. With its current market cap of 3.52 billion, CRK has annualized dividend of $0.50 while the current yield stands at 3.92%. Beta for the stock currently stands at 1.34.

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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 CRK was down-trending over the past week, with a drop of -2.30%, but this was down by -12.24% over a month. Three-month performance dropped to -22.81% while six-month performance fell -14.42%. The stock gained 67.89% in the past year, while it has lost -6.93% so far this year. A look at the trailing 12-month EPS for CRK yields 3.71 with Next year EPS estimates of 3.80. For the next quarter, that number is 0.89. This implies an EPS growth rate of -188.70% for this year and 5.91% for next year. EPS is expected to grow by 20.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 37.30%.

Float and Shares Shorts:

At present, 232.48 million CRK shares are outstanding with a float of 124.85 million shares on hand for trading. On Oct 13, 2022, short shares totaled 15.94 million, which was 6.84% higher than short shares on Sep 14, 2022. In addition to Mr. Miles Jay Allison as the firm’s Chairman & CEO, Mr. Roland O. Burns serves as its Pres, CFO, Sec. & Director.

Institutional Ownership:

Through their ownership of 35.15% of CRK’s outstanding shares, institutional investors have minority control over the company. Other institutions hold 48.17% of CRK, in contrast to 18.73% held by mutual funds. Shares owned by individuals account for 17.23%. As the largest shareholder in CRK with 4.07% of the stake, The Vanguard Group, Inc. holds 9,523,489 shares worth 9,523,489. A second-largest stockholder of CRK, SSgA Funds Management, Inc., holds 6,388,409 shares, controlling over 2.73% of the firm’s shares. Dimensional Fund Advisors LP is the third largest shareholder in CRK, holding 5,796,717 shares or 2.48% stake. With a 2.93% stake in CRK, the SPDR S&P Oil & Gas Exploration & is the largest stakeholder. A total of 6,842,611 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 1.21% of CRK stock, is the second-largest Mutual Fund holder. It holds 2,833,681 shares valued at 38.85 million. Vanguard Small Cap Index Fund holds 1.03% of the stake in CRK, owning 2,409,203 shares worth 33.03 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CRK since 13 analysts follow the stock currently. There are 2 analysts who recommend BUY ratings, while 2 suggest SELL ratings. Of the remaining analysts, 8 believe that the stock is worth HOLDING, 1 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 CRK analysts setting a high price target of $33.00 and a low target of $12.00, the average target price over the next 12 months is $19.00. Based on these targets, CRK could surge 158.62% to reach the target high and fall by -5.96% to reach the target low. Reaching the average price target will result in a growth of 48.9% 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. CRK will report FY 2022 earnings on 02/13/2024. Analysts have provided yearly estimates in a range of $3.75 being high and $3.50 being low. For CRK, this leads to a yearly average estimate of $3.59. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Comstock Resources Inc. surprised analysts by $0.01 when it reported $1.18 EPS against a consensus estimate of $1.17. The surprise factor in the prior quarter was $0.05. Based on analyst estimates, the high estimate for the next quarter is $1.08 and the low estimate is $0.71. The average estimate for the next quarter is thus $0.90.

Summary of Insider Activity:

Insiders traded CRK stock several times over the past three months with 2 Buys and 1 Sells. In these transactions, 29,025 shares were bought while 6,600 shares were sold. The number of buy transactions has increased to 33 while that of sell transactions has risen to 23 over the past year. The total number of shares bought during that period was 1,095,508 while 135,775 shares were sold.

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