Cobalt International Energy, Inc. (NYSE:CIE)
Cobalt International Energy, Inc. (NYSE:CIE) poor run in the market shows no sign of slowing down, given that the company is fresh from posting a wider than expected net loss for the first three months of the year. A net loss of $306.3 million for the first quarter was more than triple the net loss of $46.6 million reported a year earlier.
Cobalt International Q1 Results
During the quarter the independent oil and gas company says it generated $9.9 million in revenues. Cash and cash equivalents stood at $770.4 million inclusive of $250 million in Angolan asset sales. Cobalt International Energy, Inc. (NYSE:CIE) expects its capital expenditure for the year to come in at $250 million, $119 million of the amount having already been spent.
Capital expenditure should continue to decline according to the company, given that a good number of the wells have already been drilled. Cobalt International Energy, Inc. (NYSE:CIE) says it has completed drilling at Shenandoah and Anchor bay with drilling works nearing completion at North Plate.
Widening Net Loss
The widening net loss comes on the back of improving oil prices from all-time lows early last year. Over the past 12 months, the stock has shrunk from highs of $2.02 a share to current lows of $0.20 a share, though oil prices having rallied by more than 80% from the lows of $26.05 a barrel.
Cobalt International Energy, Inc. (NYSE:CIE) has attributed the massive net loss to the write-off of Shenandoah well costs. The company is also crying foul to increased interest expense on its December 2016 and January 2017 debt exchanges.
The big question at the moment is whether Cobalt energy can be able to reduce its net loss which continues to affect its sentiments among investors. Consecutive quarters of widening net losses all but continues to spook investors given that some of the company’s peers in the industry appear to have bounced back on rising energy prices.
Cobalt International Energy, Inc. (NYSE:CIE)’s stock poor run has already caught the attention of equity research firms – most of which have started to downgrade the stock amidst growing concerns over the company’s prospects. Zack Investment Research currently has a ‘hold’ rating on the stock having downgraded it from a ‘buy’ on a research note issued on April 24, 2017.
Cobalt International Energy, Inc. (NYSE:CIE)’s stock is currently trading near its 52-week lows of $0.26 a share having come under immense pressure in recent trading sessions. The stock was down by 2.09% in Monday’s trading session after the disappointing earnings report.
I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.
About the author: Monica Gray has an undergraduate degree in Accounting and an MBA – earned with Honors. She has six years of experience in the financial markets and has been a securities analyst for the past two years.