I bought MPO, probably a contrary indicator for a good report today, but it seems to me that the $4.50 range is just too low for a 35kboe/d co, but maybe not. I can't imagine that they would not put the best spin on anything they report today. If they do, Crum should be booted.
cbd, they have to announce a delevering deal or show a path to funding the capex. The growth is not as we expected a few months ago, but a plan should move the stock out of the $4s. The flip side of that is more operating disappointments. I'm not expecting a blow out release but something acceptable that doesn't reflect a mid $4s stock price. It is a #$%$ shoot but doesn't seem investors are expecting much. Worst thing would be a report with no resolution of the debt issue. I did sell a little PDCE to fund something else, the growthy cos have had a nice run, am lousy at timing this but seems we could back up a little but who knows with the global risks, a good prop for oil.
CS still sees NAV for DNR at $24, but the catalysts??? Other e and p s have growth plays that are attracting money. And DNR doesn't stack up in the yield comparison either, why would you buy DNR over KMI, which will yield 5.8% on next year's div. KMI has the EOR, probably better growth in EOR and the infrastructure plays. DNR probably holds up better in an oil price downturn, but other than that, not much attraction.
While MPO will show better wells than SD, not sure the Miss stacks up as a top tier play. Money will go elsewhere. Still might buy some MPO today for a trade, I'm betting the results exceed expectations which are fairly low imo currently. At $100+ WTi, the whole sector is undervalued. GDP should be a good speculation on the TMS play, HK gave up the Utica for it. And PDCE might still be the easiest bet in the sector, still think it could be $100 next year. Also GPOR is a good bet on the Utica as well, very low debt. Thanks Putin.
While we support SandRidge's decision to become a more focused onshore-only company, results from the Mississippi Lime have proven to be riskier and less repeatable than other US onshore plays, with several operators exiting the play in 2013.
Don, came across this. Encana took over the position.
Since Denbury was more interested in developing other parts of Encore’s portfolio, it entered into a joint venture with EnCana to extend the leases and explore approximately 100,000 acres in the play. EnCana took over operatorship of a number of wells and ramped up drilling activity in the play. Subsequently, Denbury opted out of the joint venture, leaving Encana fully in control.
The eps seems inconsequential to me. First issue should be debt deal, whatever it is, continue the course, JV, sale.... Seems investors won't care about anything other than how the debt is handled. Then it's op results, Miss IPs and Anadarko potential, we really know little about the asset since they bought it last year.
After the debt deal headline, the ebitda number hopefully is $120 mm, up from $100 mm last q. Without a deal, seems it's $6 to $8 stock sometime this year at a minimum. Convinced that debt is under control, the revolver handles the capex, and the market gives it a 6x multiple next year, you could have a $15 stock. Still seems a good but risky bet. At $4.50, not much downside unless they blow the next report. Then you have a $3 stock.
GDP seems a better bet to me longer term. Could do $370mm ebitda in '16, 8x multiple for a good shale play in the TMS, a $45 stock, debt is only $750 now vs $1.9 billion. GDP market cap, $600mm vs MPO $300mm.
Good trade might be hold MPO through Tues and buy GDP if you think the release will be positive. I don't see how it could get much worse at the moment. But it always can. Place you bets.
Looking at the MS report for MPO. If you accept their projections, $530 ebitda and it assumes $91 oil ad $4 gas, so maybe conervative. At 5x ebitda, $6.50 stock price, $$4.30 now, 50% upside. And that forecasts an 11% increase in prod for '15. Seems the revolver could handle the neg cash flow in this scenario. And if commodity prices stay where they are, the $6.50 probably becomes $7.50. With the guidance reduction from expectations, the super upside seems less likely, but still seems a good bet, 70% upside to $$7.50 in a year. Not what a lot on this board were looking for but still good. The margin for error with a debt bloated balance sheet is slim.
The Chester wells at 85% oil and that prod, the returns there would be much greater than the Miss wells. Would make investors forget about the Miss.
SD's Chester horizontal program continued to exceed expectations as SD brought two wells online at average 30-day IP rates of 726 boe/d (85% oil).
cbd, nice move on BCEI. I have a feeling that MPO might respond well next week. SD doing well in the Miss with other formations, good read through.
I vaguely remember that, don't recall how much DNR retained. ECA sees the TMS as one of their five cores, three in the US, Wattenberg and San Juan. ECA sees 40 to 50% IRRs at $12 mm well costs, if they can get costs down the returns could get to 100%, 90%+ oil. KInd of understand why HK sees it as a core, which is significant, they are trying to drill the best returning shales as fast as they can. GDP owns the same amount of TMS as ECA, 300k acres. For a $600mm co, that could be a very big deal. DVN has position there but looks like other areas will get capex, Permian, Woodford.
Don, I have looked at that before, the TMS play lies further to the east. Have been looking at Goodrich GDP, they have stumbled on the first wells in the TMS but looks like the potential is there, HK says it's a core and the next big shale play, may be hyperbole. Boone owned GDP in his fund, it was in the mid $20s not too long ago and $12 now. If the play works, they will double or more, only $600 mm of equity now. Today, they feel like a better bet than MPO, less debt, but I may buy some more MPO today, $4.35 seems a good value. The catalyst for MPO is coming soon, up or down. $5+ seems an easy expectation with any reasonable release.
I read that, have owned Williams for years, don't see what they activists could offer, they have been investor friendly. Saw a forecast that the div could be $2.80+ in '17, at 4% yield that's $70 stock price, $41 now, 70% upsde. KMI should be $55, 70% upside. KMI maybe feels the better value because they probably will exceed expectations. Both feel better than a DNR bet if you are looking for a yield investment tied to energy growth. DNR at $100 oil should be in the mid $20s, not sure how they move it closer to value.
jerry, the Barron's article has done a number on KMI, the value is there imo, stock will take a while to turn around, probably next quarter report. I have bought a bunch of the warrants which I think will be a good bet. Harold
Not much to talk about since the q3 report, only guidance without backup and a tentative capex plan, not very effective investor relations, IMO.
At least BCEI has something to talk about, should a good day for the stock tomorrow.
This is the code for the transactions, probably tax liability for restricted stock, guess that was in Finance 201.
F — Payment of exercise price or tax liability by delivering or withholding securities incident to the receipt, exerciseor vesting of a security issued in accordance with Rule 16b-3
Don, on the surface, looks like a good quarter, IPs up in Miss, extension to KS, 100k acres, 600boe/d wells. HZ Chester wells are even stronger, Woodford looks a bust so far. Nothing there detracts from MPO story. Would think the market would like it.