Antero Resources: The Thesis Is Playing Out
Richard Zeits • 14 Comments
Richard Zeits • 14 Comments
Antero Resources: Rich Valuation Represents A Risk
Richard Zeits • 10 Comments
Richard Zeits • 10 Comments
Tue, Jul. 26, 8:43 AM
- Thinly traded micro cap Tokai Pharmaceuticals (NASDAQ:TKAI) craters 70% premarket on higher-than-normal volume in response to its announcement that it will stop its Phase 3 clinical trial, ARMOR3-SV, assessing lead product candidate galeterone compared to enzalutamide (XTANDI) in treatment-naive men with metastatic castration-resistant prostate cancer (mCRPC) whose tumors express the androgen receptor splice variant AR-V7. The company made its decision based on the recommendation from the independent Data Monitoring Committee that the trial was unlikely to meet its primary efficacy endpoint.
- Tokai intends to evaluate its ongoing ARMOR2 expansion in mCRPC patients with acquired resistance to enzalutamide and its planned study in patients who rapidly progress on either enzalutamide or abiraterone acetate (ZYTIGA).
- Galeterone is an orally available small molecule that disrupts the androgen receptor (NYSE:AR) signaling pathway by degrading AR, blocking the binding of testosterone or dihydrotestosterone with AR and inhibiting CYP17, an enzyme that plays a key role in the synthesis of testosterone. Prostate cancer is stoked by androgens acting through the androgen receptor.
- Related tickers: (NASDAQ:MDVN)(OTCPK:ALPMF)(OTCPK:ALPMY)(NYSE:JNJ)
Mon, Jul. 18, 3:42 PM
- Antero Resources (AR +1.6%) is upgraded to Hold from Underperform with a $27 price target, raised from $24, at Jefferies, citing AR's recent $450M purchase of Marcellus Shale acreage in West Virginia.
- Jefferies says AR's Firm Transportation portfolio could cause concern as it calls for future reinvestment, but the firm says it has become more comfortable with the expense because it is likely to add resource inventory.
- The firm also cites valuation, as AR has underperformed gas-leveraged peers by ~41% YTD.
Thu, Jun. 9, 4:48 PM
- Antero Resources (NYSE:AR) -2.5% AH after agreeing to acquire 55K net acres and 14M cfe/day of net production in West Virginia's Marcellus Shale from Southwestern Energy (NYSE:SWN) for $450M.
- AR says substantially all the acreage will be dedicated to Antero Midstream Partners (NYSE:AM) for gas gathering, compression, processing and water services.
- To fund the deal, AR announces a public offering of 26.75M common shares, with an underwriters option to purchase up to an additional ~4M shares.
- SWN says it plans to use the cash from the deal to reduce the principal balance of its $750M term loan due in November 2018.
Thu, Mar. 24, 10:07 AM
- Antero Midstream Partners (AM -12.8%) plunges at the open after Antero Resources (AR -1.8%) prices the sale of 8M of its units held in AM at $22.40/unit, for $179M in gross proceeds.
- After the sale - and assuming no exercise of the underwriter's option to purchase 1.2M additional common units - AR will own ~62% of AM's outstanding common and subordinated units.
- AM will receive no proceeds from the offering.
Fri, Feb. 19, 1:11 PM
- Antero Resources (AR -3.8%) extends its two-day loss to 10% since announcing a 23% Y/Y reduction to its 2016 capital budget to $1.4B from its prior-year spending of $1.8B.
- AR plans to operate an average of 7 drilling rigs between the Marcellus and Utica Shale plays, 50% fewer than its average 14 drilling rigs operated in 2015; in shifting activity toward the Marcellus from the Utica, AR says ~75% of its drilling and completion budget is allocated toward the Marcellus.
- AR forecasts FY 2016 production to rise 15% Y/Y to 1.715B cf/eday of gas, with net liquids increasing 24% to 60K bbl/day.
Fri, Feb. 12, 2:37 PM
- Whiting Petroleum (WLL -8.9%) may have received the toughest treatment from Moody's, but the ratings agency downgrades a total of eight of companies as part of a sweeping re-examination of oil and gas producers.
- The ratings affected companies rated Ba, or the first tier of debt Moody’s considers risky enough to be a speculative investment.
- While Moody's cut WLL's debt rating by five notches, SM Energy (SM -1.2%) and WPX Energy (WPX +3.5%) both fell four notches to B2 from Ba1, and cites the likelihood of a "dramatic increase in financial leverage in 2017” with SM's cut.
- QEP Resources (QEP -0.5%) and Energen (EGN -11.6%) fell three notches to B1 from Ba1.
- Unit Corp. (UNT +2%) fell two notches to B2 from Ba3, which Range Resources (RRC +0.7%) and Newfield Exploration (NFX +2.7%) both slipped to Ba3 from Ba1.
- Ratings for Antero Resources (AR +2.7%) and Concho Resources (CXO +2.2%) were confirmed at Ba2 and Ba1, respectively.
Tue, Feb. 9, 3:18 PM
- Antero Midstream Partners (AM +0.9%) earns a Buy rating from Janney analysts, who believe the pullback in the units opens an attractive entry point for long-term investors.
- "The uncertainty surrounding drilling schedules and production volumes appears to be at a peak frenzy,” Janney says, adding that investors who buy sound assets at moments of uncertainty are usually well rewarded.
- The firm anticipates 26% annual distribution growth, an estimate it says is underpinned by attractive drilling economics at its sponsor, Antero Resources (AR -5.3%).
Tue, Jan. 5, 2:47 PM
- An eventual upturn in crude oil prices should turn the tide for the E&P sector In 2016, Citi analyst Robert Morris says as he upgrades Anadarko Petroleum (APC -1%), Canadian Natural Resources (CNQ +1%), EOG Resources (EOG +0.8%) and Cimarex Energy (XEC +1.4%) to Buy from Neutral and ups Oasis Petroleum (OAS -3.3%) to Neutral from Sell.
- For the first time in more than a decade, the per share debt-adjusted growth metrics within the E&P sector showed no correlation to the share price performance in 2015, according to Morris; without a further collapse in commodity prices, he sees debt-adjusted growth metrics, along with key debt metrics and the ability to increase production by spending within cash flow, driving relative E&P share performance.
- Morris maintains Buy ratings on Antero Resources (AR -2.4%), Apache (APA -2.3%), Concho Resources (CXO +1%), Memorial Resource Development (MRD -2%), Range Resources (RRC -0.4%) and Whiting Petroleum (WLL -7.1%), but downgrades Hess (HES -0.5%) to Neutral from Buy.
Dec. 9, 2015, 10:47 AM
- EQT Corp. (EQT +1.4%) and Gulfport Energy (GPOR +3.9%) are J.P. Morgan's top picks among E&P companies focused on the Marcellus and Utica shales, which the firm says are structurally advantaged, given the low-end of the U.S. natural gas cost curve and vast inventories of ready-to-drill locations.
- The firm says EQT's cash cost structure of $1.11/Mcfe and total cost structure of $2.35/Mcfe are well below the average of Marcellus/Utica peers, a key competitive advantage within a natural gas environment that could remain "challenged for many years."
- GPOR's positioning within the Utica Shale includes 160K net acres in the core of the dry gas window, which JPM provides the company with a "remarkable growth opportunity" over the next 10-plus years.
- JPM initiates Cabot Oil & Gas (COG +2.5%), Eclipse Resources (ECR +7.3%), Range Resources (RRC +4%), Rice Energy (RICE +6.3%) and Southwestern Energy (SWN +3.4%) with Neutral ratings, and starts Antero Resources (AR +2.6%) at Underweight.
Mar. 5, 2015, 8:25 AM
- Antero Resources (NYSE:AR) -3.5% premarket after announcing a public offering of 11.5M common shares, with an underwriters option to purchase up to another 1.725M shares.
- AR says it will use the proceeds to repay part of the outstanding borrowings under its credit facility.
Feb. 26, 2015, 3:21 PM
- Antero Resources (AR -1.6%) is lower despite beating expectations for Q4 earnings and revenues.
- AR says it plans to spend $1.6B during 2015 for drilling and completion activities in the Marcellus and Utica shale plays, down 36% Y/Y; the budget excludes the $425M-$450M planned for Antero Midstream Partners (AM +1%) relating to high- and low-pressure gathering pipelines and compressor stations.
- CEO Paul Rady says he is optimistic about the potential for AR's 179K net acres in a Utica deep, dry gas window in West Virginia and Pennsylvania.
- AR's Q4 total production rose 87% Y/Y and 17% Q/Q to 1.265B cfe/day, and liquids production jumped 172% Y/Y and 22% Q/Q to ~30.5K bbl/day.
Dec. 22, 2014, 10:45 AM
- Natural gas prices fall 9.5% to near two-year lows at $3.133/mmBtu, in the biggest one-day percentage loss since February and the lowest intraday price since January 2013, on mild weather forecasts and inventory that is above year-ago levels.
- Prices are now down more than 15% in three straight losing sessions and are 30% lower than the six-month high closing price of $4.489/mmBtu it hit just a month ago.
- Weather has been unseasonably warm for December, limiting demand for home heating and allowing relatively low stockpiles to catch up to where they were a year ago and encouraging traders to sell based on the belief that supply is relatively healthy.
- Gas producers are among the biggest early decliners: XOM -1.1%, CHK -7.3%, APC -2.6%, SWN -6%, DVN -2.2%, COP -2.3%, BP -1.5%, COG -4%, BHP -1.9%, CVX -1.3%, ECA -5.1%, EQT -4.3%, RDS.A -1.7%, UPL -12%, WPX -6.9%, EOG -1%, OXY -1.1%, RRC -6.1%, APA -2.3%, AR -3.2%, CNX -3%, QEP -4.8%, LINE -4.9%, NBL -1.6%, SM -2.6%, XEC -4.2%, PXD -2.9%, NFX -5.1%.
- ETFs: UNG, DGAZ, UGAZ, BOIL, GAZ, FCG, GASL, KOLD, UNL, NAGS, DCNG
Dec. 8, 2014, 3:37 PM
- Energy stocks are hammered again as oil prices tumble to fresh five-year lows, and Oasis Petroleum (OAS -16.1%), Emerald Oil (EOX -12.7%), Cobalt International Energy (CIE -10.1%) and Canadian Natural Resource (CNQ -4.8%) are slammed more than most as they suffered analyst downgrades today.
- SunTrust's Ryan Otaman cuts OAS and EOX to Neutral from Buy to account for their large debt loads, while Citi's Robert Morris lowers CIE and CNQ to Neutral from Buy.
- However, Morris thinks at least some stocks warrant upgrades after precipitous declines, raising Antero Resources (AR -9.1%), Apache (APA -6.1%) and Newfield Exploration (NFX -8.3%) even while acknowledging they probably will not bottom until oil does - a common view among analysts such as Raymond James' Marshall Adkins, who writes that "trying to figure out appropriate oilfield service valuations under a collapsing oil price environments is an exercise in futility."
Nov. 5, 2014, 12:58 PM
- Antero Midstream Partners (AM +16.5%), the partnership formed by Antero Resources (AR +1.4%), is trading near $30/unit in its trading debut after pricing its IPO at $25 yesterday, well above the $19-$21 expected price range and raising $1B in total gross proceeds.
- The IPO comes just a week after Shell Midstream Partners raised $1.06B, making it the largest MLP IPO on record, but the Antero deal would surpass the figure as underwriters exercise an option to sell additional shares.
- AM owns pipelines and compressor stations in the core of the Marcellus Shale in northwest Virginia and Utica Shale in southern Ohio, and provides services to AR under long-term, fixed-fee contracts.
Oct. 17, 2014, 5:40 PM
Oct. 15, 2014, 2:52 PM
- Antero Resources (AR +6.1%) is higher after reporting a 91% Y/Y jump in Q3 natural gas production volume, while net daily liquids production more than tripled from the same quarter last year.
- AR says it averaged 1.08B cfe/day during Q3, up 21% Y/Y, with net daily liquids production spiking 217% Y/Y and 24% Q/Q to 25K bbl/day.
- AR also says it now has 361 horizontal wells in the Marcellus and Utica shale formations since beginning its Appalachian operations in 2009.
Antero Resources Corp. is an independent oil and natural gas company, which engages in the exploration, development and acquisition of unconventional oil and liquids-rich natural gas properties located in the Appalachian Basin in West Virginia, Ohio and Pennsylvania. It focuses on unconventional... More
Sector: Basic Materials
Industry: Oil & Gas Drilling & Exploration
Country: United States
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