Unit Corp - Aggressive Growth

Unit Corp. (UNT) is seeing strong growth across all of its revenue streams and shares are pressuring new highs.

Thanks to the recent earnings revisions and surprise, the stock is now a Zacks #1 Rank (Strong Buy).

Company Description

Unit Corp. has subsidiaries engaged in oil and gas exploration, production, contract drilling and gas gathering and processing.

Net Income Up 53%

On Feb 22 Unit Corp. reported fourth-quarter net income of $43.7 million, a 53% jump from the same period last year. Revenues grew 42% to $252.6 million.

Contract drilling rigs almost doubled year over year and per day rates grew 13%. The segment is a growing portion of the company’s business, accounting for 39% of its revenue.

Earnings per share for the period came in at $0.92, up from $0.60 a year prior and was 2 cents higher than the Zacks Consensus Estimate, snapping a streak of back-to-back misses.

Looking Bullish

Analysts quickly began raising estimates after the earnings results and comments that said the company is pleased with the positive in each segment carrying over into 2011.

The consensus estimate for full-year 2011 is up 20 cents, to $3.68. Next year’s estimates are averaging $4.25, up 37 cents. These levels represent annual growth rates of 19% and 15%, respectively.

The Chart

Shares of UNT have been on fire. The stock is now hesitating just at its previous. But with a strong shift in momentum they should push right through that mark. Waiting for shares to set a new high for confirmation first wouldn’t be a bad idea though. Take a look below.

Bill Wilton is the Aggressive Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the Zacks Small Cap Trader service

 
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