The only reason I can think of to explain the drop in MTDR while other E&Ps rise is that some see their aggressive CapEx budget of $440 Million as possibly leading to further offering of shares. The company says that they intend to finance the budget through Operating cash flow and borrowings, but there is a question about whether they can increase their borrowing base (through additions to reserves at strong pricing) fast enough to cover needs.
Altruism in action. The law firm of Dewey, Cheatum, and Howe rides to our rescue. The probable settlement they seek will be a discount coupon on a gallon of gas for shareholders and millions in cash for the law firm.
Almost all small and mid E&Ps are down today and were yesterday. My guess is that what we are seeing is sector rotation. Not the kind in which everyone is heading for the exits, but one in which no one wants in. Oil is back up, and if the economy actually improves more oil will be used. But such improvement in the economy may lead to a stronger dollar resulting in weaker oil pricing.
SFY's leases are mostly in the gassy portion of the EF. In addition, until they can sell some more of their gassy assets in other areas, they are heavily leveraged. If oil and gas pricing stays firm, they would be probably be undervalued; but if prices drop the leverage could be problematic.
Oil prices are softening and the stocks priced for growth (high pe) are being hammered because of the fear that that growth will not hold up if oil pricing weakens further. That fear probably will hammer eps with a lot of debt leverage also (which does not apply to FANG).
ED (sticking to my warm Dr. Pepper)
enjoying life Less
Honesty from ED? This is how his post ends (although the "Less" is in blue)
No question that LPI has impressive assets and prospects, but reaction to quarterly reports has more to do with what has been accomplished in terms of growth. LPI increased production 17% over the year ago quarter. Compare the triple digit growth rate of MTDR and FANG for instance.
LPI has not had the sort of growth that others among its peers have had in the past year. That's why LPI has been hit harder than others.
But have the analysts set MTDR up for failure with ever increasing setimates?
Sentiment: Strong Buy
Energen price target raised to $98 from $88 at Sterne Agee
Sterne Agee found Energen's liquids growth commentary confusing, but it thinks the company clarified the issue in a subsequent press release. The firm raised its target on the stock based on what it sees as strong exploratory well results and Energen's likely 2014 capital allocation. Sterne Agee keeps a Buy rating on the stock.
Global warming scare has been very, very good for Al. +$400 to 500 million worth. UN spokesman sums up their latest report " There would have been warming had it not been for the cooling."