Forest Oil -12% after missing Q3 forecasts

|About: Forest Oil Corporation (FST)|By:, SA News Editor

Forest Oil (FST -11.9%) is falling sharply after missing its Q3 earnings and revenue numbers, mainly due to lower net sales and natural gas sales volumes as it postponed capital investment in its natural gas properties to concentrate on higher-margin oil prospects; lower oil and gas prices also contributed to the decline.

Q3 net sales volume fell 38.4% Y/Y to 209M cfe/day; production expenses of $1.39/M cfe rose 13%.

Production shortfall was attributable mostly to the Texas Panhandle division, which is held for sale, but Eagle Ford did not yield the hoped-for step change in well performance that would help address the downside risk inherent in the stock's valuation, Richard Zeits writes.