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Concho Prices Public Offering of 7.7 Million Common Shares

Independent exploration and production company, Concho Resources Inc.CXO recently priced a public offering of 7.70 million shares of its common stock. Per company estimate, total gross proceeds, before underwriters' fees and estimated expenses from the issue, would be approximately $712 million. The underwriters have been given an option for 30 days to purchase up to an additional 1,155,000 shares of common stock from the company.

Concho expects to use the proceeds from the offering to repay all outstanding borrowings under its credit facility. Borrowing levels increased in recent times to finance acquisitions, and for general corporate purposes, including funding potential acquisitions.

Concho Resources Inc. is an independent oil and natural gas company engaged in the acquisition, development, exploitation and exploration of oil and natural gas properties. The company's conventional operations are primarily focused on the Permian Basin of Southeast New Mexico and West Texas.

In addition, the company is involved in a number of unconventional emerging resource plays. With holdings of around 605,000 net acres across the Permian Basin, 22,000 drilling locations and approximately 3 billion oil-equivalent barrels of resource potential, Concho Resources' asset portfolio is primed for high production growth and peer-leading returns.

However, the company has lately been hassled by a number of reasons. In July, the company reported lukewarm second-quarter numbers. Performance was affected by continued weak crude oil, natural gas and natural gas liquids commodity prices.

The company currently carries a Zacks Rank #3 (Hold). However, there are better-ranked stocks in the oil and gas sector like Alon USA Partners, LP ALDW , Braskem S.A. BAK and ReneSola Ltd SOL . All these hold a Zacks Rank #1 (Strong Buy).

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RENESOLA LT-ADR (SOL): Free Stock Analysis Report

CONCHO RESOURCS (CXO): Free Stock Analysis Report

BRASKEM SA (BAK): Free Stock Analysis Report

ALON USA PTNRS (ALDW): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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