California Resources Corp (NYSE:CRC): Classic Breakout As Soros Buys


Independent oil and gas company California Resources Corp (NYSE:CRC) staged a technical breakout in classic style Tuesday, with sentiment boosted by north-bound crude oil prices.

Oil prices rallied 6 percent on Tuesday after hitting a 3-month low on Monday.

Shares in California Resources Corp (NYSE:CRC) jumped 19.92% to close at $14.90 on volume of 3.85 million shares.

Technically, CRC broke out above the upper line of a symmetrical triangle pattern forming over the last five months. That line coincided with the 200-day moving average, and its penetration throws the stock into a higher bull orbit. The stock had already crushed the 20-day and 50-day lines
on November 9.

CRC is the largest oil and natural gas exploration and production company in California on a gross-operated basis, and operates its resource base exclusively within the State of California.

Soros invests in California Resources Corp (NYSE:CRC)

A Bloomberg report said yesterday that George Soros, through his Soros Fund Management vehicle, loaded up on stocks in the energy and emerging markets sectors.

The report said that CRC was one of the energy stocks that Soros purchased, in addition to others such as Petroleo Brasilerio SA, Rice Energy Inc. and pipeline owner Williams Cos.

Soros could presumably be having an eye on the OPEC confabulations regarding a production cut, and it may be his view that the oil cartel would arrive at some kind of agreement at its meeting on November 30.

California Resources Corp (NYSE:CRC) has a mixed third quarter

For the third quarter, CRC reported EPS of $-1.75, which missed by $0.20, and revenue of $456 million, which beat estimates by $24.4 million but was down 27.2% year on year.

Todd Stevens, President and Chief Executive Officer, said, “In the third quarter, we began to ramp up our field activities, while continuing to keep our investments within our cash flow.”

“We anticipate our increased drilling activity in the remainder of 2016 and 2017 has the potential to position CRC for an inflection point in our business,” he added. “Our debt position was reduced by a net $625 million in the third quarter as a result of our tender for our unsecured bonds. This brings our total debt reduction to approximately $1.5 billion from peak levels after the spin.”


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