Approach Resources Inc. (AREX) Shares Down 9.7% Following Weak Earnings

Approach Resources Inc. (NASDAQ:AREX) dropped 9.7% during trading on Thursday following a dissappointing earnings announcement. The company traded as low as $2.56 and last traded at $2.66, with a volume of 980,870 shares changing hands. The stock had previously closed at $2.94.

The energy company reported ($0.11) earnings per share for the quarter, missing the Thomson Reuters’ consensus estimate of ($0.09) by $0.02. Approach Resources had a negative return on equity of 6.84% and a negative net margin of 169.54%. The business had revenue of $24.97 million during the quarter, compared to the consensus estimate of $25.86 million. During the same quarter last year, the company earned ($0.25) EPS. Approach Resources’s revenue for the quarter was up 11.3% on a year-over-year basis.

A number of research firms have commented on AREX. Zacks Investment Research cut shares of Approach Resources from a “hold” rating to a “sell” rating in a research note on Tuesday, July 18th. Scotiabank set a $3.00 target price on shares of Approach Resources and gave the stock a “hold” rating in a research note on Saturday, May 6th. BidaskClub cut shares of Approach Resources from a “hold” rating to a “sell” rating in a research note on Thursday, July 27th. ValuEngine upgraded shares of Approach Resources from a “sell” rating to a “hold” rating in a research note on Saturday, July 1st. Finally, Seaport Global Securities cut shares of Approach Resources from a “neutral” rating to a “sell” rating and reduced their price objective for the company from $3.00 to $0.50 in a research report on Wednesday, June 21st. Three research analysts have rated the stock with a sell rating, three have given a hold rating and two have assigned a buy rating to the company. The company has an average rating of “Hold” and a consensus price target of $3.20.

In other news, major shareholder Wilks Brothers, Llc acquired 88,000 shares of the company’s stock in a transaction on Monday, June 19th. The stock was bought at an average cost of $2.72 per share, with a total value of $239,360.00. The purchase was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Insiders have acquired 2,651,000 shares of company stock valued at $7,268,650 over the last ninety days. 7.80% of the stock is owned by insiders.

Hedge funds and other institutional investors have recently bought and sold shares of the company. First Manhattan Co. raised its position in Approach Resources by 136.1% in the first quarter. First Manhattan Co. now owns 3,664,779 shares of the energy company’s stock valued at $12,386,000 after buying an additional 2,112,371 shares during the last quarter. Vanguard Group Inc. raised its position in Approach Resources by 21.6% in the second quarter. Vanguard Group Inc. now owns 1,959,374 shares of the energy company’s stock valued at $6,603,000 after buying an additional 347,986 shares during the last quarter. California Public Employees Retirement System raised its position in Approach Resources by 2.2% in the second quarter. California Public Employees Retirement System now owns 1,274,300 shares of the energy company’s stock valued at $4,294,000 after buying an additional 27,600 shares during the last quarter. Marathon Asset Management LP raised its position in Approach Resources by 9.3% in the first quarter. Marathon Asset Management LP now owns 1,170,382 shares of the energy company’s stock valued at $2,937,000 after buying an additional 100,000 shares during the last quarter. Finally, Boston Partners raised its position in Approach Resources by 41.2% in the first quarter. Boston Partners now owns 1,150,617 shares of the energy company’s stock valued at $2,888,000 after buying an additional 335,810 shares during the last quarter. 24.49% of the stock is owned by institutional investors.

The company’s market capitalization is $209.81 million. The stock’s 50 day moving average price is $2.95 and its 200 day moving average price is $2.74.

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Approach Resources Company Profile

Approach Resources Inc is an independent energy company. The Company is focused on the exploration, development, production and acquisition of unconventional oil and gas reserves in the Midland Basin of the greater Permian Basin in West Texas. The Company’s business segment is the exploration and production of oil, natural gas liquids (NGLs) and natural gas.

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