Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
Thanks for the question. Current production is ~50mmcfe/d, or ~8300 boepd, just under 1/3 oil and ngl. I've been focusing on EBITDA rather than production metrics recently as EBITDA takes into account product pricing (gas vs oil vs ngls, price differentials, etc) and is reflective of actual economics for the companies.
2P is tough for GST, I don't think GST discloses it, and it just shot up through the roof with the recent Hunton acquisition. If they measured it like the Canadian companies that do disclose 2P reserves, it would likely be in the range of $1 billion (very rough estimate), versus a current ~$500 mm enterprise value.
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
Its hard to tell whats going on at SD right now. It looks like well results have been disappointing, particularly in the Mississippian trusts SD is operating - http://seekingalpha.co...
I think Gastar is a cleaner story - the balance sheet is simpler, production is growing rapidly, and it is undervalued compared to its peers in the Marcellus. The Hunton horizontal redevelopment makes sense, and it looks like results are economically superior to the Mississippian.
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
Competition in the Hunton would be great for Gastar. Gastar has ~100,000 net acres in the core of the play. If other companies drill in the area, it will help prove up the play for Gastar.
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
Perhaps, but at current valuations I'd much rather own GST.
I got an email today after this article was published from a smart, successful investment analyst who has a position in GST that he started building at 80 cents a share. He still has a very large position, and he suggested that GST may actually hit $90 million in EBITDA in 2013, and exit 2013 at a substantially higher run-rate. If that happens, GST may be one of the best performing energy stocks this year.
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
UPL trades at 10.5x EV/run rate Q1 2013 operating cash flow. This equates to a $10.4 price for GST (adjusted & normalized) and is below the multiples of the other stocks. UPL probably should trade at a discount to this set of comps as UPL's Marcellus appears to be less economic than the others', except perhaps REXX's.
Mart Resources: A 14% Yield And Big Catalysts [View article]
Have you dug into Renegade? Looks like they're way outspending cash flow, makes the dividend look pretty unsustainable (thus the high yield). Any thoughts?
Energy Operations Updates: Halcon And Gastar [View article]
There was enough reserve upside for there to be a massively oversubscribed $200 million high yield deal at 100 bps below the offer price. I don't have non-public information about the company's reserves, but the upside is obviously the undeveloped Marcellus inventory and the huge Hunton play. If the Hunton works how management thinks it will, GST could be worth many times what it is currently trading for.
Energy Operations Updates: Halcon And Gastar [View article]
Not going to happen. Its a bond offering, going to be used to pay down bank debt and to fund the acquisition and share buyback. Might still be positive for the preferred as it will improve Gastar's liquidity position. But should be better for the common stock.
Mart Resources: A 14% Yield And Big Catalysts [View article]
Is Mart still producing cost oil or have they flipped to profit oil? Sometimes these international producers need to be examined closely, as their production can be cut dramatically when they go from "cost recovery" phase into "profit" phase.
Get Ready For The Big One - Bakken Flooding Coming This Year? [View article]
The topography does support the contention I made - there were substantial production and drilling disruptions the last time there was significant flooding in the region, in 2011. Yes, some locations are on high ground, but they need to be accessed by roads which go through lower areas. I checked with multiple operators in the area prior to publishing and they acknowledged the risk of flooding impacting operations.
To my knowledge, the weather predictions were inaccurate, there has not been significant flooding. However, the point about valuations and production disruptions has been accurate, despite WTI oil at almost $100/barrel, KOG and TPLM are down since the article, driven to a certain extent by production disappointments, partly driven by weather / road access.
Energy Operations Updates: Halcon And Gastar [View article]
The street numbers for GST were off for Q1 and way off for Q2, they'll be coming up, particularly as production accelerates on the back of this new debt issue. It doesn't make sense to hit them for the debt and then not credit them for what they're spending it on.
HK's numbers look like they will come down more. I don't know how one can accurately model wells in exploratory plays, sounds like a good way to end up being "precisely wrong".
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
2P is tough for GST, I don't think GST discloses it, and it just shot up through the roof with the recent Hunton acquisition. If they measured it like the Canadian companies that do disclose 2P reserves, it would likely be in the range of $1 billion (very rough estimate), versus a current ~$500 mm enterprise value.
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
I think Gastar is a cleaner story - the balance sheet is simpler, production is growing rapidly, and it is undervalued compared to its peers in the Marcellus. The Hunton horizontal redevelopment makes sense, and it looks like results are economically superior to the Mississippian.
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
I got an email today after this article was published from a smart, successful investment analyst who has a position in GST that he started building at 80 cents a share. He still has a very large position, and he suggested that GST may actually hit $90 million in EBITDA in 2013, and exit 2013 at a substantially higher run-rate. If that happens, GST may be one of the best performing energy stocks this year.
Discrepancy In This Marcellus Stock Valuation - Highlighted By Overlooked Disclosure [View article]
Warren Resources; A Rare Deep Value E&P Opportunity [View article]
Mart Resources: A 14% Yield And Big Catalysts [View article]
Energy Operations Updates: Halcon And Gastar [View article]
Energy Operations Updates: Halcon And Gastar [View article]
Mart Resources: A 14% Yield And Big Catalysts [View article]
Get Ready For The Big One - Bakken Flooding Coming This Year? [View article]
To my knowledge, the weather predictions were inaccurate, there has not been significant flooding. However, the point about valuations and production disruptions has been accurate, despite WTI oil at almost $100/barrel, KOG and TPLM are down since the article, driven to a certain extent by production disappointments, partly driven by weather / road access.
Energy Operations Updates: Halcon And Gastar [View article]
Energy Operations Updates: Halcon And Gastar [View article]
Energy Operations Updates: Halcon And Gastar [View article]
HK's numbers look like they will come down more. I don't know how one can accurately model wells in exploratory plays, sounds like a good way to end up being "precisely wrong".
Energy Operations Updates: Halcon And Gastar [View article]
In other news, GST announced a $200 mm notes offering, the stock is up 6% so far and could reprice further upon successful completion of an offering.