Analysts weigh in on oil and gas exploration and production firm Ultra Petroleum Corp. (NYSE:UPL) and fast food company Jack in the Box Inc. (NASDAQ:JACK). While Ultra Petroleum shares lost more than a third of their value today after confirming draw down of remaining credit facility capacity, Jack in the Box shares slumped following disappointing earnings results. Let’s take a look and see what the analysts have to say about UPL and JACK.
Ultra Petroleum Corp.
Shares of Ultra Petroleum are collapsing, down around 40% at time of writing, after the company disclosed that it has drawn the entire available amount under its $1 billion credit facility capacity, and formally noted it faces challenges complying with debt covenants and refinancing existing debt.
Sterne Agee CRT analyst Tim Rezvan was the first to comment: “We believe news that “the company is evaluating a variety of strategic alternatives” bodes poorly for the outlook for UPL shares. We believe [earnings] results will be of little solace to any investors long UPL shares today.”
“The company now has $3.76 billion of debt outstanding, after drawing down the remaining $266 million available on its credit facility. Current debt consists of $999 million of credit facility borrowings, $1.3 billion of debt issued at the parent level and $1.46 billion of debt issued at the subsidiary level that is pari passu with the credit facility,” the analyst added.
Rezvan reiterated a Neutral rating on shares of Ultra Petroleum, with a price target of $0.65, which implies an upside of 60.5% from current levels.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Tim Rezvan has a yearly average return of 10.6% and a 60% success rate. Rezvan has a -55.9% average return when recommending UPL, and is ranked #392 out of 3640 analysts.
Jack in the Box Inc.
Shares of Jack in the Box are falling nearly 16% in late trading, after the company reported a smaller than expected quarterly profit. However, BTIG analyst Peter Saleh remains positive, reiterating a Buy rating on the stock, with a price target of $93.
Saleh commented, “Earnings results were clearly weaker than expected and, perhaps more significantly, represent a directional change in trend following several years of consistent upward revisions. While the stock will likely see a considerable decline today, we believe there were some positives in the release including the increase in Jack in the Box franchise mix target and a reduction in G&A. On the call, we would focus on the sales weakness at Jack in the Box, greater detail on the planned sales initiatives including value offerings and commentary on the announced long-term strategies.”
According to TipRanks.com, analyst Peter Saleh has a yearly average return of 1.9% and a 62.5% success rate. Saleh is ranked #1442 out of 3640 analysts.
Out of the 5 analysts polled by TipRanks, 4 rate Jack In The Box stock a Buy, while 1 rates the stock a Hold. With a return potential of 50%, the stock’s consensus target price stands at $96.