Boston, MA 04/28/2014 (wallstreetpr) – Clayton Williams Energy, Inc. (NYSE:CWEI) is a $1.8 billion company in the oil and natural gas production. The company announced reported Q1.14 earnings performance that exceeded the performance in the prior year quarter. The improvement in earnings in the quarter was supported by the ongoing asset sales that the company expects will result in even more costs savings.
The company’s investment in high-margin fields can also be seen impacting earnings positively and showing the potential to support performance in the upcoming quarters. Moreover, continued costs cutting should help the company save adequate cash for consistent distribution to shareholders.
Q1.14 in summary
Clayton Williams Energy, Inc. (NYSE:CWEI) reported net income of $11.4 million, suggesting 94 cents per share. That compared with a loss of $41 million or $3.39 per share in the corresponding quarter of last year. Q1.14 also saw cash flow improvement from $44.3 million a year ago to $79.3 million. Analysts expected earnings of 79 cents in the quarter.
Revenue in the quarter came in at $124.60 million, which compared with $108.56 million that Wall Street expected for the quarter. The revenue in the latest quarter was up 12.4 percent compared to a year ago.
Asset divestment
Sale of underperforming assets is expected to help the company trim costs and also streamline operations, which is important for creating value for the shareholders and attaining growth in the company. Asset divestitures can be seen taking place in the oil and gas sector as producers abandon non-core assets to concentrate on activities that promise higher margins and lower costs.
Analysts recommend buy
Clayton Williams Energy, Inc. (NYSE:CWEI) is a favorite of most Wall Street analysts covering the stock. Out of the six analysts covering the stock currently, four have a “buy” recommendation while two have a “hold” recommendation. That brings the average stock recommendation to a “buy.” The favorable ratings suggest that the road ahead is likely to deliver good news for the investors.
Shares of the company closed at $144.59, each and up 3.26 percent on the day. The stock enjoys the highest price target of $170 from SunTrust.
