SandRidge Mississippian Trust I: Valuation Compelling After The Correction
- The risk/reward offered by the Trust’s units has shifted from unfavorable just several months ago to quite favorable currently.
- Under Pessimistic Scenario discussed in the article, the units offer a ~9%-10% IRR to maturity, which, arguably, is a good return for this type of risk.
- More optimistic scenarios suggest a substantially higher upside.
- “Flatter than feared” production volumes in the next two quarters should not be ruled out and could become a powerful catalyst for the units.
- I estimate the next quarterly distribution to be ~$0.23 per unit.