On a brighter note, SunTrust raised their target to $12 and likes the improving story. Neal Dingmann is the analyst with this call and he's regularly a Street First Teamer in the annual voting.
Better Trading Ahead?
While the short interest and the recent performance are certainly troubling, there is reason to be optimistic on this stock. Recent earnings estimate activity has actually been quite positive as of late, even in the face of such widespread pessimism.
Thanks to these rising estimates, we actually have a Zacks Rank #2 (Buy) on SFY, so we clearly don’t believe in the negativity surrounding this firm. After all, it is hard not to be at least a little optimistic on the short term when you consider that 3 estimates have moved higher in the past 60 days compared to 1 lower in the same time frame, while the consensus has also increased.
Given this, a short-covering rally is certainly in the cards for SFY stock, especially if investors embrace the positive earnings estimate revision picture, suggesting that SFY could definitely move higher in the weeks ahead.
BY Dow Jones & Company, Inc.— 6:05 AM ET 07/31/2014
SFY also increases 2014 production guidance. Leading the way was the company's Eagle Ford shale holdings, where SFY's daily average output surged 71% on-year. The results are welcome news for shareholders who have seen the stock slide 9.8% in July, including 2.4% this week. Expect a relief rally today. SFY is inactive premarket
Gas Market Not Cooperating With Gas Growth
Strategy; Maintain Underperform
■ Maintain Underperform. SFY delivered stronger than anticipated 2Q14
results on better gas realizations and lower operating expenses, and while
we increase our 2014/15/16 EBITDAX estimates 10%/4%/7% primarily
driven by higher natural gas production, we still foresee SFY having a tough
road ahead digging out from its leverage burden with limited core inventory.
As such, we maintain our Underperform rating and $10 target price.
Delivering Gas Growth in a Weak Gas Environment. SFY gas production
surprised to the upside in 2Q14, as the company focused on high-rate gas
well development in its Fasken area where interuptible pipeline capacity
became available during the quarter. On the back of strong results in Fasken
the company increased 2014 production guidance 3% at the midpoint to
32.5-33.2 Mboe/d, driven by an 8% increase in gas volumes offset by
respective 4% and 1% decreases in estimated oil and NGL volumes. SFY
also introduced preliminary 2015 production guidance of 34.5-36.2 Mboe/d,
a ~7% increase at the midpoint which the company anticipates it can deliver
while spending more in line with cash flow. The company will remain focused
on the area with its recent JV with Saka Malyasia completed and additional
firm transportation agreements increasing capacity to 160 MMcf/d gross in
■ Valuation. SFY is trading at a 12% premium to our ‘PD-Plus’ NAV vs. a 12%
discount for its peers. On multiples, SFY is trading 4.5x and 5.4x 2014E and
2015E EBITDA (unhedged at futures strip) vs. 6.5x and 5.9x for the peer
haha I was in today at 10.86 and out 4 hours later at 11.50. Not a bad day, just wished I had more to invest right now
Credit Suisse repeated their Under Perform this morning in a follow up note to the conference call and that caused the weakness at the open. Nice contrarian buy.
It seems like an orchestrated dip for someone to cover? But not the masses. i just happened to be online at an opportune time.
Remember what happened last month where we just reached the $12.50 strike price on calls when it seemed impossible the day before. No manipulation here!
Nice re-entry price. The Street still has little respect for the NG space and anybody whose growth is coming from there. Funds will buy again here during the shoulder season as a bet on a cold winter.
Management remains too top heavy here, too expensive too maintain and should have articulated on the recent call a better strategy for doing something to enhance the LA liquids production.
During the 1st Qtr 2014 earnings call, an analysts asked management for a number. The analysts asked if they were expecting $200 to $220 million. Management neither denied nor confirmed the figure.
Recently issued 10Q shows $11 million in revenue from the properties which are very undeveloped. The 10K provides reserve estimates for the property. Based on all of this, an amount between $200 and $300 million is very real.
Management stated on the 2nd Qtr 2014 earnings call that they would entertain an offer for the Southeast Louisiana properties also if one came along. 2nd Qtr revenues for these properties were $34 million. One can only imagine what they would bring.
Underground Stock Alerts* (google em) just came out with a detailed report on SFY today - I recommend any fellow shareholders here sign up immediately and wait for the next update, last time they alerted a stock as a buy it went up 1350%, and last two times they put out sell ratings the stocks dove over 75% - don't be the last to know and get screwed, I learned my lesson on their AAPL sell alert, and GOOG buy alert sub $300
know what "real" value of La. properties is in $$? Perhaps the stock is selling off because of
potential bigger write down is necessary That and declining oil price. The production & income
from La shows fairly steep declines in quarterly report. As a stockholder there's no way to garner
this inside information. Personally I do not understand stock sell off in view of solid report
With the new wells annual revenue is exceeding over 800 million dollars.
Eagle Ford production was up 71% year over year for Q 2. EF production was 69% of total production in Q 2. I guess you forgot to mention that.
Grossly overvalued! Lake Washington which was their bread & butter, is now a liability, and workover nightmare. The chalk production is a liability. Pressure on 3 different strings of casing, and H2S gas. Their prize possession the Fasken, has been given away for 175 million, paying down 125 million in short term revolving line of credit because of pressure from the banks, with the proceeds. With only two rigs presently in operation, they have 7 engineers in the office, and 4 field engineers, plus a whole host of geologists, and two drilling managers, plus drilling consultants in the field. Very top heavy organization, the veritable inverted pyramid. The shorts are not stupid, they are just waiting.