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PRO articles cover stocks that fly under most investors' radar screens.
SandRidge Mississippian Trust II- Nightmare Turning Into Reality
- SandRidge Mississippian Trust II announced a quarterly distribution on July 31st of $0.486 for common unit holders.
- Distributable income for the quarter was $18.1M, which on a fully diluted per unit basis was below threshold, so subordinated units received $0.00 per unit.
- Production for the quarter continued to decrease sharply at 392 MBOE, far below the year earlier level of 651 MBOE.
- Risk remains high that proven reserves currently reported by the Trust are lower than presently represented in public financial documents.
- Based on the considered riskiness of current estimates of proven reserves and expected future oil and gas price levels, the current Trust market price level is considered overvalued.
SandRidge Permian Trust: Solid Results, Fairly Valued
- SandRidge Permian Trust announced a quarterly distribution on July 31st of $0.632 for common unit holders.
- Distributable income for the quarter was $30.6M, which on a fully diluted per unit basis was below threshold, so subordinated units received only $0.432 per unit.
- Production for the quarter was in-line with previous models published at 382 MBOE, virtually flat year over year reflecting drilling activity that has replaced production from declining older wells.
- Trust drilling is expected to complete by the end of the 4th quarter 2014.
- The August 1st Trust market price level of $12.66 is considered fair and implies a 9% rate of return to investors through Trust termination in 2031.
ECA Marcellus Trust I - Still An Expensive Natural Gas Pure Play
- ECT units current trade at a 1.74 multiple of the 12/31/2013 PV-10, comparatively high to industry peers.
- Supportive natural gas derivative contracts expired in March 2014, a negative for distributions beginning in August 2014.
- A model of expected future distributable Trust income shows the current unit traded value is unrealistically high relative to market risk.
SandRidge Mississippian Trust II: PV-10 Reflects Another Mississippian Nightmare In The Making
- SDR recorded a 3338 MBOE downward adjustment (13.2%) to proven reserves in the latest PV-10 due to well performance issues.
- PV-10 per unit fell to $7.62 at year 2012, a 43.6% decline from the April 2012 IPO standard measure.
- Downward trajectory of PV-10 revision is highly correlated with (SDT) proven reserve historical results (SDT is the sister Trust of SDR which went IPO in April 2011).
- Recommended Target Valuation Lowered to $7 per unit, in-line with $6 SDT Target.
Chesapeake Granite Wash PV-10 Update - Disaster Continues
- Newly published 12/31/2013 PV-10 shows an additional 6,220 MBOE reduction due to well performance (22% Year-over-Year).
- Overall the Trust has seen an impairment of 36.9% of proven reserves due to well performance issues.
- Closing price of $11 per unit on 3/14/2014 is 1.62 times the updated PV-10 value of $6.72; shares are considered grossly overvalued given continued high risk.
SandRidge Permian Trust- Ugly Updated PV-10 Priced In?
- PV-10 published on 2/28/2013 showed 2,192 MBOE downward revision in reserves - a greater than 10% drop relative to IPO levels.
- Energy price curve upward move recently off-setting negative reserve revisions.
- Price Target lowered to $12 per unit; upside possible if Forward Oil Price Curve breaks out and is sustained above $100 per barrel contrary to current market view.
- SandRidge Permian Trust- Q4'13 Results Show Risk And Reward
- SandRidge Mississippian Trust II: Third Quarter Results Down, Units Oversold
- SandRidge Permian Trust: Third Quarter Results Show Solid Performance
- Chesapeake Granite Wash Trust Q3 Results - Expect Pain To Continue
- SandRidge Mississippian Trust I - Small Improvement, Under-Performance Continues
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