Callon Petroleum (CPE) is facing a challenging outlook. The plunge in oil prices is going to hurt its earnings and cash flows. The company, however, has been improving its cost structure and has some downside protection with hedges. But the Houston, Texas-based shale oil producer neither has a stout balance sheet nor robust liquidity. I think the company's weak financial health could continue to weigh heavily on its stock.
Image courtesy of Pixabay.
The global oil market is confronting a huge imbalance in supply and demand that's reached near-crisis proportions. The spread of the