Kosmos Energy (NYSE:KOS) Shares Gap Up - Should You Buy?

Key Points

• Shares gapped up, opening at $3.05 (prior close $2.93) and last trading around $3.03, but analysts have a consensus "Reduce" rating with a $2.22 average price target (2 Buy, 4 Hold, 3 Sell).
• Kosmos shows financial stress with a debt-to-equity of 5.53, a negative net margin (−54.18%) and negative ROE (−39.29%), and reported quarterly EPS of −$0.16.
• Despite weak fundamentals, insiders have been buying: the CEO and CFO purchased large blocks at $1.90 on March 10 and insiders bought ~3.68M shares (~$7M) in the last 90 days.

Kosmos Energy Ltd. (NYSE:KOS - Get Free Report)'s share price gapped up before the market opened on Tuesday . The stock had previously closed at $2.93, but opened at $3.05. Kosmos Energy shares last traded at $3.03, with a volume of 4,041,570 shares.

Analyst Ratings Changes

Several equities research analysts recently weighed in on KOS shares. Sanford C. Bernstein reduced their price objective on shares of Kosmos Energy from $1.70 to $0.80 and set a "market perform" rating for the company in a report on Monday, January 5th. The Goldman Sachs Group downgraded shares of Kosmos Energy from a "neutral" rating to a "sell" rating and set a $2.25 price objective for the company. in a report on Thursday, April 9th. Wall Street Zen downgraded shares of Kosmos Energy from a "hold" rating to a "sell" rating in a report on Saturday. Johnson Rice raised shares of Kosmos Energy from an "accumulate" rating to a "buy" rating and set a $4.25 price objective for the company in a report on Wednesday, March 25th. Finally, Weiss Ratings reaffirmed a "sell (d-)" rating on shares of Kosmos Energy in a report on Monday, December 29th. Two analysts have rated the stock with a Buy rating, four have given a Hold rating and three have issued a Sell rating to the company. According to data from MarketBeat.com, Kosmos Energy presently has a consensus rating of "Reduce" and a consensus price target of $2.22.

Kosmos Energy Stock Up 1.4%

The company has a debt-to-equity ratio of 5.53, a quick ratio of 0.45 and a current ratio of 0.75. The company has a market capitalization of $1.43 billion, a price-to-earnings ratio of -2.03, a P/E/G ratio of 0.42 and a beta of 0.65. The stock's fifty day simple moving average is $2.54 and its two-hundred day simple moving average is $1.72.

Kosmos Energy (NYSE:KOS - Get Free Report) last issued its quarterly earnings results on Saturday, February 14th. The oil and gas producer reported ($0.16) earnings per share for the quarter. Kosmos Energy had a negative net margin of 54.18% and a negative return on equity of 39.29%. The business had revenue of $294.62 million during the quarter. On average, sell-side analysts anticipate that Kosmos Energy Ltd. will post 0.24 EPS for the current year.

Insider Activity at Kosmos Energy

In other news, CEO Andrew G. Inglis acquired 315,790 shares of Kosmos Energy stock in a transaction on Tuesday, March 10th. The stock was bought at an average cost of $1.90 per share, with a total value of $600,001.00. Following the completion of the purchase, the chief executive officer owned 4,542,807 shares of the company's stock, valued at $8,631,333.30. This represents a 7.47% increase in their ownership of the stock. The purchase was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CFO Nealesh D. Shah acquired 157,894 shares of Kosmos Energy stock in a transaction on Tuesday, March 10th. The shares were purchased at an average cost of $1.90 per share, with a total value of $299,998.60. Following the completion of the purchase, the chief financial officer directly owned 1,863,061 shares of the company's stock, valued at approximately $3,539,815.90. This represents a 9.26% increase in their position. The disclosure for this purchase is available in the SEC filing. In the last ninety days, insiders bought 3,684,210 shares of company stock valued at $6,999,999 and sold 272,844 shares valued at $377,592. Corporate insiders own 1.99% of the company's stock.

Institutional Trading of Kosmos Energy

Hedge funds have recently bought and sold shares of the company. Parallel Advisors LLC increased its holdings in Kosmos Energy by 41.0% in the third quarter. Parallel Advisors LLC now owns 24,634 shares of the oil and gas producer's stock worth $41,000 after buying an additional 7,169 shares during the last quarter. Orion Porfolio Solutions LLC increased its holdings in Kosmos Energy by 18.8% in the second quarter. Orion Porfolio Solutions LLC now owns 57,782 shares of the oil and gas producer's stock worth $99,000 after buying an additional 9,159 shares during the last quarter. SmartHarvest Portfolios LLC increased its holdings in Kosmos Energy by 73.0% in the first quarter. SmartHarvest Portfolios LLC now owns 23,814 shares of the oil and gas producer's stock worth $66,000 after buying an additional 10,050 shares during the last quarter. Equitable Holdings Inc. increased its holdings in Kosmos Energy by 30.3% in the fourth quarter. Equitable Holdings Inc. now owns 45,539 shares of the oil and gas producer's stock worth $41,000 after buying an additional 10,598 shares during the last quarter. Finally, Public Employees Retirement System of Ohio increased its holdings in Kosmos Energy by 35.7% in the fourth quarter. Public Employees Retirement System of Ohio now owns 42,577 shares of the oil and gas producer's stock worth $39,000 after buying an additional 11,209 shares during the last quarter. 95.33% of the stock is owned by hedge funds and other institutional investors.

Kosmos Energy Company Profile

Kosmos Energy Ltd. is an independent oil and gas exploration and production company headquartered in Dallas, Texas. Since its founding in 2003, the company has focused on identifying and developing hydrocarbon reserves in frontier and emerging basins around the world. Kosmos combines geological and geophysical expertise with a disciplined approach to acreage acquisition and partner selection to pursue high‐impact offshore exploration opportunities.

The company's portfolio is anchored by assets in West Africa and the Gulf of Mexico.

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