Tuesday's IBD 50 Stocks To Watch pick, Ranger Oil, is near a new buy point amid the struggling stock market rally. Ranger declined almost 2% Tuesday midday, as the stock market sold off.
Stocks To Buy And Watch: Ranger Oil
Houston-based Ranger Oil is an oil and gas exploration and production company with a focus in the Eagle Ford Shale.
On May 4, Ranger reported strong first-quarter earnings and sales. Earnings soared 382% year over year to $4.68 per share. Revenue surged 190% to $256.5 million. The company also announced a $100 million share-repurchase program and initiated a 25-cent-per-share annual dividend that will start in Q3 2022.
"We are off to a great start in 2022 as we continue to execute our business strategy, generate Free Cash Flow and deliver returns for shareholders," said Chief Executive Darrin Henke in a press release. "Our strong balance sheet, disciplined capital investments, and exceptional operational performance continues, yielding significant Free Cash Flow and allowing us to strengthen our high-margin inventory through recently announced accretive acquisitions."
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Ranger's IBD Stock Ratings
Ranger shows a hefty 97 out of 99 Earnings Per Share Rating and a best-possible SMR grade of A, according to IBD Stock Checkup. The SMR Rating analyzes a company's sales, margins and return on equity, and offers a letter grade from A (the best) to E (the worst). The company's triple-digit sales growth in the latest quarter aided the SMR Rating.
Meanwhile, ROCC stock shows a strong 97 out of 99 IBD Composite Rating. Investors can use the IBD Composite Rating to easily gauge the quality of a stock's fundamental and technical metrics.
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Ranger Stock Eyes Buy Point
Ranger stock is building a double-bottom base with a 40.94 buy point, according to MarketSmith pattern recognition. Shares are about 12% below that potential entry, so Ranger Oil has its work cut out for it ahead of a potential breakout.
The stock decisively regained its 50-day line during Monday's 6.3% advance. Shares were still holding above that key level despite Tuesday's 1.8% midday loss.
A key strength is the stock's relative strength line. Its RS line is at its highest level since March, when it surged to new highs in the wake of a breakout past a 35.09 cup-with-handle entry. A strong RS line during a weak general market is a strong technical indicator.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the stock market.
