Upstream energy company
EXCO Resources Inc.
) announced the closure of its $500 million notes offering. The
notes, due to mature in 2022, were issued at 100% of the principal
value and carried an interest of 8.500%.
EXCO Resources stated that after deducting underwriter discounts
and other offer-related expenses, the company received $490.0
million from the offering. Part of the net proceeds was utilized
for repaying the entire outstanding term loan. The remaining
proceeds were spent toward lowering the revolving commitment under
the Amended and Restated Credit Agreement of the company.
Dallas, TX-based EXCO Resources is primarily involved in the
exploration, development and production of oil and gas resources as
well as the acquisition of these properties. As of Dec 31, 2013,
the total estimated proved reserves came in at 1.1 trillion cubic
The company's disciplined cost control measure which is reflected
in the significant year-over-year reduction in total development
and exploration expenses is commendable. However, substantial
reduction in production volumes in 2013 from the previous year is a
matter of concern.
EXCO Resources is expected to release first-quarter 2014 results on
Apr 29, after the closing bell. The Zacks Consensus Estimate for
the company's first-quarter earnings is currently pegged at 4 cents
per share, down 2 cents in the past two months, amid negative
In keeping with these views, EXCO Resources currently carries a
Zacks Rank #3 (Hold), implying that it is expected to perform in
line with the broader U.S. equity market over the next one to three
Meanwhile, one can consider better-ranked players in the
exploration and production industry like
Miller Energy Resources, Inc.
Abraxas Petroleum Corp.
Clayton Williams Energy, Inc.
). While Miller Energy sports a Zacks Rank #1 (Strong Buy), Abraxas
and Clayton Williams hold a Zacks Rank #2 (Buy).
(We are reissuing this article to correct a mistake. The
original article, issued April 17, 2014, should no longer be relied
ABRAXAS PETE/NV (AXAS): Free Stock Analysis
WILLIAMS(C)ENGY (CWEI): Free Stock Analysis
MILLER ENERGY (MILL): Free Stock Analysis
EXCO RESOURCES (XCO): Free Stock Analysis
To read this article on Zacks.com click here.