Berry Corporation: Working Capital Changes To Have Less Impact On Q2 Dividends

Aug. 03, 2022 1:48 AM ETBerry Corporation (BRY) StockBRY5 Comments

Summary

  • Berry declared a $0.13 variable dividend related to Q1 2022 results.
  • It would have been able to declare a $0.35 to $0.40 variable dividend without the impact of working capital changes.
  • Discretionary cash flow in Q2 should improve by $0.16 per share just due to the working capital changes from Berry's bond interest accruals.
  • I've been expecting Berry to increase its full-year operating cost guidance. Despite this, Berry may be able to offer a 25% yield over the next year.
  • I estimate Berry's value at $12 per share in a long-term $75 Brent environment.
  • Looking for more investing ideas like this one? Get them exclusively at Distressed Value Investing. Learn More »

Oil pump, oil industry equipment

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Berry Corporation (NASDAQ:BRY) looks pretty undervalued ahead of Q2 2022 earnings. Since I last looked at Berry in May, commodity prices have come down a bit (with 2022 and 2023 Brent strip several dollars lower now), but Berry's stock

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This article was written by

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Aaron Chow, aka Elephant Analytics has 15+ years of analytical experience and is a top rated analyst on TipRanks. Aaron previously co-founded a mobile gaming company (Absolute Games) that was acquired by PENN Entertainment. He used his analytical and modeling skills to design the in-game economic models for two mobile apps with over 30 million in combined installs. He is the author of the investing group Distressed Value Investing, which focuses on both value opportunities and distressed plays, with a significant focus on the energy sector. Learn more>>

Analyst’s Disclosure:I/we have a beneficial long position in the shares of BRY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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