Why PDC Energy's Shares Jumped
Feb 27th 2013 2:39PM
Updated Feb 27th 2013 3:35PM
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of energy company PDC Energy jumped 14% today after the company released earnings.
So what: The company increased revenue by 9.2% in the quarter to $108.6 million, ahead of estimates, but the bottom line came with a big shocker. The company recorded a $166.7 million impairment charge and that pushed the company to a $126.2 million loss, or a whopping $4.17 per share.
Now what: The charge is related to the company's Piceance Basin proved oil and natural gas properties and doesn't look good on the balance sheet. The company would have had a loss even without the charge, something that will keep me away from the stock for now. I need to see more production improvement, and serious improvement on the bottom line, before speculating on this stock.
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The article Why PDC Energy's Shares Jumped originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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