Continental Resources Stock Hits Multi-Year Highs on Buyout Offer

The all-cash offer valued the company at $25.41 billion

Deputy Editor
Jun 14, 2022 at 10:34 AM
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Continental Resources Inc (NYSE:CLR) is surging today, after the company received a buyout offer from billionaire founder Harold Hamm. The all-cash offer to take the company private from Harold Hamm’s family trust valued the company at $25.41 billion. The Hamm family holds about 83% of the stock's total outstanding common shares, and according to the offer letter, the family will remain as long-term shareholders without pushing for any strategic options, should the independent committee reject the proposal.

At last check, CLR is up 14.7% at $73.97, and earlier hit an eight-year high of $75.45. The security has been moving steadily upwards on the charts, up 110.1% year-over-year, with support from the 120-day moving average since December 2020. 

The security looks ripe for a short squeeze, given short interest makes up a hefty 32.9% of CLR's available float. It would take nearly four days to buy back these bearish bets, at the stock's average pace of daily trading. 

Continental Resource stock's typically quiet options pits are seeing a lot more activity than usual today, with options volume running at seven times what is normally seen at this point. The September 85 call is the most popular, with new positions opening there. 

Analysts, meanwhile, are split on Continental Resources stock, leaving plenty of room for upgrades and /or price-target hikes. Of the 15 firms in coverage, eight say "buy" or better, while seven carry a tepid "hold" or worse rating. Plus, the 12-month consensus target price of $76.08 is a slim 2.8% premium to current levels.

 

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