Leading Bakken oil producer, Continental Resources, Inc. ( CLR ) has declared a two-for-one stock split of its common stock to be issued in the form of a stock dividend. The additional shares will be distributed on Sep 10, 2014 to shareholders of record on Sep 3.
The split is a smart move on the part of management as it would make Continental Resources' shares accessible to a greater number of investors. The strategic move is probably aimed at lowering the stock's traded price to more attractive levels.
Continental Resources' shares are currently trading near their 52-week high and have appreciated by over 57% in the past one year. By maintaining steady market capitalization, the move is expected to entice more investors who might feel that the shares are trading significantly higher than its peers.
Oklahoma City-based Continental Resources is an independent exploration and production company focused on the Bakken, Cana and Niobrara shale plays. It has leases on nearly 1.1 million acres in the Bakken Shale region.
The company operates in the North, South and Eastern regions of the U.S. Its North region - north of Kansas and west of the Mississippi river - comprises North Dakota Bakken, Montana Bakken, the Red River units and the Niobrara play in Colorado and Wyoming. The first two hold the maximum promise for Continental Resources.
The Southern region includes Kansas and all properties south of Kansas and west of the Mississippi river, and comprises the Anadarko Woodford and Arkoma Woodford plays in Oklahoma.
Continental Resources expects to increase total crude oil and natural gas production in the range of 26% to 32% in 2014. Of the total production, 70% is expected to be crude oil. Continental Resources' organic capital expenditure for 2014 is estimated at $4 billion. The budget takes into account the ongoing trend of reduced well costs.
Continental Resources currently carries a Zacks Rank #3 (Hold). Investors interested in the oil and gas sector could try out better-ranked stocks like Weatherford International plc ( WFT ), Sanchez Energy Corp. ( SN ) and Sunoco Logistics Partners L.P ( SXL ). All these stocks sport a Zacks Rank #1 (Strong Buy).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.