Cimarex Energy (XEC) Q2 Results - Aug 6

[dan_s]

Highlights of XEC's Q2 Results:

Daily production averaged 274.8 MBOE; oil production averaged 83,430 barrels per day < Both numbers beat my Q2 forecast.

3Q oil production expected to be 85.0- 91.0 MBO/d; up 5.5 percent sequentially < More growth in Q3 than my forecast.
2019 oil production expected to grow 23-29 percent; led by the Permian region
2019 capital guidance unchanged

> Cimarex Energy Co. (XEC) today reported second quarter 2019 net income of $109.3 million, or $1.07 per share, compared to $141.0 million, or $1.48 per share, in the same period a year ago.
> Second quarter adjusted net income (non-GAAP) was $83.0 million, or $0.82 per share, compared to second quarter 2018 adjusted net income (non-GAAP) of $151.9 million, or $1.59 per share. < Compares to my forecast of $132.8 million Net Income.
> Net cash provided by operating activities was $414.0 million in the second quarter of 2019 compared to $321.2 million in the same period a year ago.
> Adjusted cash flow from operations (non-GAAP) was $336.4 million in the second quarter of 2019 compared to $349.5 million in the second quarter a year ago. < Adjusted cash flow compares to my forecast of $383.9 million.

Updating my forecast model now.

[dan_s]

XEC closed today at $43.95
This afternoon two analysts sent out fresh reports on the company:

Michael Scialla at Stifel Nicolaus rates it a BUY with a $92.00 price target.

Gabriele Sorbara at Williams Capital rates it a BUY with an $83.00 price target.

I have updated my forecast/valuation for XEC. I'm lowering my valuation to $83.00 at least until we see an increase in their realized natural gas and NGL prices.