Abandonment and impairment of unproved properties should not be pro-forma'd out. This is a true expense on which capex is expended. Also, stock compensation is a real expense. RRC has true earnings power of $1. Put a 12x multiple, and this is a $12 stock. Ridiculous that it trades at a 30x multiple and 5x revenues.
Statoil paid CHK $5,000+ per net acre in the Marcellus, for a non-operated position. What does that tell you about RRC's 900k+ net acres?
They have 15-20 TCF locked up in a project that is profitable at $4 NG. The Marcellus is the project to own. That's what this NG shakeout is teaching us. RRC has an enormous position. It's development is just beginning. Get in now.
E&Ps don't trade based purely on EPS. Ultra Petroleum traded at 50x EPS for years. It was trading based on NAV - 12 TCF+ in Pinedale attached to a small company. Same concept here with RRC, except better individual well economics.
The NAV is vastly overestimated. People don't take into account the huge amount of capex and opex that is needed to pull the oil/gas out of the ground. And no one is going to pay the inflated prices for land that these companies were paying in past years. It is like a real estate speculator paying high prices for property saying that it's justified on the basis of NAV.
It is what it is: a $35 stock at present in AHs in the wake of its excellent Q Report, not what you as a short wish it would be. Looks like you've got a decision to make. In such situations, its best to deal with reality rather than to stubbornly hold on to a position moving against you.