On Dec 24, Zacks Investment Research downgraded upstream
Triangle Petroleum Corporation
) to a Zacks Rank #4 (Sell).
ABRAXAS PETE/NV (AXAS): Free Stock Analysis
WILLIAMS(C)ENGY (CWEI): Free Stock Analysis
HARVEST NATURAL (HNR): Free Stock Analysis
TRIANGLE PETROL (TPLM): Free Stock Analysis
To read this article on Zacks.com click here.
Why the Downgrade?
Operating environment and future growth prospects seem week for
Triangle Petroleum, as reflected by the decreasing earnings
estimates for the Denver, Colo.-based company. Over the last 30
days, the Zacks Consensus Estimate for the fourth quarter of
fiscal 2014 (three months ended Jan 31, 2014) has decreased 12.0%
to 22 cents per share. Moreover, the Zacks Consensus Estimate for
fiscal year 2014 is 76 cents, down 6.2% over the same
On Dec 9, 2013, Triangle Petroleum released lower-than-expected
fiscal third-quarter 2014 (three months ended Oct 31, 2013)
earnings. Earnings per share - excluding one-time items - came in
at 18 cents, lagging the Zacks Consensus Estimate of 24 cents.
Significant increase in operating expenses affected the results.
Operating expenses were recorded at $71.4 million during the
third quarter, reflecting a substantial hike of 225.6% from the
Finally, Triangle Petroleum is a small cap firm and has to
largely rely on outside source of capital. The company may find
it difficult to gather capital for financing its growth projects.
Stocks that Warrant a Look
While we expect Triangle Petroleum to perform below its peers and
industry levels in the coming months and see little reason for
investors to own the stock, one can look at better-ranked players
in the oil and gas exploration and production sector like
Harvest Natural Resources Inc.
Clayton Williams Energy Inc.
Abraxas Petroleum Corp.
). Harvest Natural and Clayton Williams Energy retain a Zacks
Rank #1 (Strong Buy), while Abraxas Petroleum sports a Zacks Rank