The Fat-Pitch Approach to California Resources Corporation (CRC) Investing

On November 29, 2019, California Resources Corporation (NYSE:CRC) shares lost -2.53% or -0.17 points to close at $6.54 with a thin trading volume of 1.449 million shares. It opened the trading session at $6.6, the shares rose to $6.89 and dropped to $6.52, the range by which the price of stock traded the whole day. The company now has a market cap of $324 million and currently has 49.57 million outstanding shares. California Resources Corporation (CRC) stock has accumulated 8.1 percent of market value in 21 trading days.

CRC stock’s trailing 3-year beta is 4.46, meaning there will be a greater rate of return, although posing a higher risk. The part of a firm’s profit given to each outstanding share of regular stock was $7.73 share in the trailing 52 weeks. The stock’s value fallen -61.62 percent year to date (YTD) compared to a decline of -73.81 percent in 52 week’s period. The firm’s shares are still trading -78.33 percent below its 1-year high of $30.18 and 39.74 percent up from 52-week low of $4.68. The average consensus ranking on the company is 2.6, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a sell.

California Resources Corporation (CRC) is most likely going to rise 194.34 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $35-month high price target. This represents a whopping 435.17 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $15.5, which means a return possibility of 137 percent in comparison with the closing price of the stock of $6.54 on November 29. The lowest price set for the stock is $7.5 — just above 14.68 percent from CRC share price now.

Past records have indicated that shares in California Resources Corporation rose on 9 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings. Investors will get the next hint of CRC’s Q4 earnings on March 02. Analysts are predicting revenue to suffer decline of -41.9 percent to $626M in the financial fourth quarter, while EPS will soar by about -56.6 percent to $0.23 per share. In the last quarter, it earnings of $0.63 per share came better than the -$0.31, adjusted, expected by Thomson Reuters consensus estimate. Revenue for the quarter was $1.08B, topping the $658.79M analysts had expected. Earnings are seen to rise by 208.2 percent this year, -25.1 percent in the coming year.

Let’s take a glimpse at some insider activity at California Resources Corporation (NYSE:CRC) and observe the pattern. The earliest insider trade happened on 08/15/2019. POLADIAN AVEDICK BARUYR gathered a total of 10 thousand shares of the firm at average share price of $9.03. The total amount for the purchase was set at $90.3 thousand. On completing this exchange, the Director account balance was 48.44 thousand shares. The stock lost -27.57 percent from that insider purchase. On 08/09/2019, Leon Francisco, EVP Corp Dev & Strategic Plng, did a purchase of 1.5 thousand shares at a price of $10.21 per share. This increased 15.32 thousand shares to the insider’s fortune and the stock experienced a -35.95 percent retreat in price since the news became public. This exchange saw 30.87 thousand shares get into the EVP Corp Dev & Strategic Plng account.

On 08/08/2019, EVP-Operations & Geoscience Williams Darren recorded a purchase transaction valued at $20.04 thousand. The purchase at $10.02 a share has added 2 thousand shares into the insider’s portfolio position. Meanwhile, shares price witnessed -34.73 percent decrease since the transaction reporting date. The company insider is left with 66.66 thousand shares remaining in the account. Weiss Charles F., who works as EVP – Public Affairs at the company, performed a purchase of 0.3 thousand shares in a transaction worth $3.05 thousand. The acquisition recorded on 08/08/2019 was priced at $10.17 per share. The stock price plunged -35.69 percent since the transaction. Weiss Charles F. currently holds a stake of 71.85 thousand in CRC stock which is worth $469.92 thousand after the insider buying.

The stock is lingering around the initial support level of $6.41. After this, the following support is at the zone of $6.28. Up until the time the CRC stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 41.43 on the daily chart, and this may be a cause for concern. In case the price goes below $6.28 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $6.78 level may cause a pull-back move approaching $7.02 mark.

California Resources Corporation (CRC) shares are trading at a P/E ratio of 0.8 times earnings posted in the trailing 12 months. The industry CRC deals with has an average P/E of 13.4. Its P/B ratio is standing at 0X compared to the 1.2 industry average. It is additionally sporting a 0.1 on the Price-to-Sales ratio, compared to the industry’s P/S average of 1.6. California Resources Corporation has a 70.4% gross profit margin, with its operating margin around 30%. Alongside this, the company’s net profit margin currently stands at 12.2%.