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Barron's: QEP Resources, prodded by Jana, is a cheap oil and gas play

  • Among the many oil and gas companies that have recently captured the interest of activist investors, QEP Resources (QEP +1.2%) looks especially attractive, David Englander of Barron's writes.
  • Sterne Agee's Tim Rezvan notes that at QEP's current stock price, investors are assigning "little to no value" to QEP's pipeline assets and its 60% interest in QEP Midstream (QEPM); while a full separation isn't likely to happen right away, the company may speed the process of dropping down pipeline assets to QEPM.
  • Rezvan values QEP's pipeline assets at $13/share, assuming a multiple of 9x EBITDA, and thinks the E&P business is worth 5x EBITDA, or $31/share.
Comments (1)
  • jggsparty
    , contributor
    Comments (3) | Send Message
     
    I am long QEPM-I bought QEPM in the hopes that someone like Jana would shake QEP management's tree and hopefully that would lead to some drop-down activity to QEPM. MLPs must either grow or they will lag the field. QEP management, for whatever reasons, does not seem inclined to act to add value to its businesses, and will need a push to the posterior to move forward.
    13 Nov 2013, 04:49 PM Reply Like
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