Comstock Resources Inc (NYSE:CRK) Is Yet Another Oil Slump Victim

[[tagnumber 0]][[tagnumber 1]]Comstock Resources Inc (NYSE:CRK) is one of the myriad of stocks that have fallen victim to declining oil & gas prices for the last year or so. As evident from the stock‘s 12–month performance to date, CRK peaked at $25.54 last August and hit a 52–week low of $0.99 barely two weeks ago. Following a recent rebound, CRK shares are now traded around the $2.60 mark. However, the odds in favor of a full recovery might not be there yet.[[tagnumber 2]] [[tagnumber 0]]A look at the company‘s financials clearly shows how adverse an impact the recent slump in oil prices has had on Comstock‘s top and bottom line and everything in between. The independent energy company announced earnings for the second quarter of 2015 on Aug. 5, one day after hitting a 52–week low. While revenues shrank by 50% on a year–over–year basis, the company‘s loss per share (minus one–time items) of $1.11 beat expectations by a few cents. At the same time, however, CRK incurred a record loss of $135 million, or twice as much as the Q1 loss and nowhere near the $1.9 million profit made in Q2 2014.[[tagnumber 2]] [[tagnumber 0]][[tagnumber 6]]Obviously, the gap is widening and it is reflected into analysts‘ recommendations on the stock with the “Hold“ and “Sell“ grades now prevalent among many of them. What is more, they do not expect the company to rake in any profits over the next few years, either.[[tagnumber 2]] [[tagnumber 0]]In this respect, the huge short interest in CRK among investors is hardly surprising at this stage. Indeed, CRK is being heavily shorted and the stock‘s average trading volume is greatly outnumbered by the short sold shares. That is why, prospective shorters are advised to examine the implications of a days–to–cover ratio of 9 before jumping on the bandwagon.[[tagnumber 2]] [[tagnumber 0]]The heavy insider buying seems to be one of the few lights at the end of the tunnel for Comstock. Over the last twelve months, insiders got hold of more than 2 million shares acquired in forty transactions. By contrast, they got rid of 0.3 million shares in thirteen transactions, which accounts for a healthy net insider activity – a good sign of insiders‘ confidence in the stock.[[tagnumber 2]]