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Investors eyeing Delta Petroleum as a way to profit from rising energy prices may want to explore elsewhere, Barron's says. The exploration and production company has missed initial production guidance in five of the past seven quarters, and it is expected to lose $0.65/share this year and $0.39/share next while cash flow rose less than $3M last year and slid $4M in the first half of 2007. Still, Barron's notes, shares trade at a high valuation compared to peers as fans of the company shrug off the dismal numbers looking, rather, for good news on projects the company has touted as possible big natural-gas plays. Yet little has come from most thus far, while Barron's says a jump in dry-hole costs to $15M in the first half from $1.4M last year suggests Delta isn't finding as much as investors expect. Indeed, one analyst calls the company "a terribly unprofitable business," while another says that if the company continues to disappoint, the stock could slide another 20%, or more.

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Source: Delta Petroleum a Risky Business - Barron's