Getting a lot of earnings reports from the small and mid-cap energy plays this morning. Most like Cimarex Energy (XEC) and PetroQuest (PQ) are providing disappointing results especially in regards to revenues. One stock that reported today, Swift Energy (SFY), came in with a report that easily beat earnings estimates and also surprised on the top line. It also has had recent insider buying and analysts believe the stock price should be much higher.
Key highlights from just released SFY earnings report:
- Reported earnings of $0.07 per share, $0.11 better than the consensus calling for a 4 cent loss.
- The company had production of 2.92 million barrels of oil equivalent ("MMBoe") during the quarter, an 11% increase over second quarter 2011 production of 2.64 MMBoe, and a 4% sequential increase compared to first quarter 2012 production of 2.80 MMBoe.
- Revenue came in at $134.8mm versus the $131.28mm consensus estimate.
- Stated reserve growth will increase 15% to 20% in FY2012, higher than previous guidance.
Four reasons SFY is a bargain at under $19 a share:
- Insiders have bought some 60,000 new shares in multiple transactions since May.
- The stock is selling near the bottom of its five year valuation range based on P/B, P/S and P/CF.
- The median price target of the 13 analysts that cover the stock is just north of $36 a share, almost double the current price of the stock. Credit Suisse has an "Outperform" rating and a $37 price target on the stock.
- The stock is too cheap at just over 2 times trailing annual operating cash flow.
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in SFY over the next 72 hours.