Seeking Alpha
Long only, contrarian, special situations, value
Profile| Send Message|
( followers)  

I recently came across a fast-growing energy concern named Midstates Petroleum (NYSE:MPO). The shares go for just $6 and its growth prospects are intriguing. It also seems to be picking up some significant positive catalysts recently.

Here are several recent positives for Midstates:

  • Analyst firm CK Cooper just initiated the shares as a "Buy" with an $11 price target, ~80% above the stock's current price. Its analyst noted: "The company estimates it has over 1,500 drilling locations on its Mississippi Lime and Anadarko Basin properties, the majority of which are MPO operated, providing it with ample running room in the Mid-Continent."
  • Canaccord Genuity also initiated the shares as a "Buy" in late April.
  • Consensus earnings estimates for FY 2013 have more than tripled over the last three months. FY 2014 consensus estimates have improved 80% over that time frame as well.
  • In April, the company agreed to a $620 million deal to acquire oil-weighted properties in the Western Anadarko Basin in Oklahoma and Texas from Linn Energy (NASDAQ:LINE). MPO's management stated the deal is immediately accretive in 2013 to cash flow per share, earnings, EBITDA, proved reserves, and production per share.

Here are four additional reasons why MPO is an intriguing growth pick at $6 a share:

  1. Revenues are exploding. Analysts expect revenues to more than double in FY 2013 and increased more than 40% in FY 2014 as well.
  2. Insiders have picked up over 250,000 shares since August.
  3. Earnings are expected to more than double to 20 cents a share in FY 2013 and go up another 80% to 36 cents a share in FY 2014.
  4. The 11 analysts who cover the stock have a median price target of $10 a share.
Source: Midstates Petroleum: Analyst Believes $6 Shares Have More Than 50% Upside