Perhaps no exploration company has benefited more from the growth in the Bakken than Continental Resources (NYSE:CLR). Its Chairman Harold Hamm was one of the first pioneers of horizontal drilling. Since using the advanced technique, Continental has quickly become one of the largest producers as well as the largest leaseholder in the Bakken.
Those hefty land leases have translated into vast reserves and production potential. CLR recently updated its reserve estimates to include the lower Three Forks and boosted total estimated reserves by 57%. This upping of reserves will help translate in higher production over the next few years. Continental hopes to boost production from today’s 98,000 barrels of oil equivalent per day to 300,000 by 2017.
CLR isn’t the cheapest E&P firm on the planet — with a trailing P/E of 21 — but it’s one of the most profitable (and its forward ratio is under 13). Gross margins currently sit north of 89%.
That statistic — along with the fact that CLR is trading for about 11% below its 52-week high — could make shares a buy.