Sanchez Energy (SN)

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dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Sanchez Energy (SN)

Post by dan_s »

I spent the morning working on an updated profile for SN that we will send out via e-mail late today. I see nothing that makes me change my valuation of $28.00/share.

First Call's price target is $15.40.

The 2nd quarter will be the first quarter that shows the full impact of their big acquisition from Anadarko. I think the Wall Street Gang will be very impressed.
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Re: Sanchez Energy (SN)

Post by dan_s »

I have posted the updated profile and forecast/valuation model for SN to the EPG website.
Dan Steffens
Energy Prospectus Group
cmm3rd
Posts: 420
Joined: Tue Jan 08, 2013 4:44 pm

Re: Sanchez Energy (SN)

Post by cmm3rd »

Dan,

SN share price continues to be under pressure, having fallen below support at 9, and now 8 (currently 7.81).

Is your "Fair Value Estimate" still 28? Are you aware of any change, positive or negative, in the fundamentals discussed in your March 24 profile?

Thanks.

Scott
dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Re: Sanchez Energy (SN)

Post by dan_s »

Nothing changed in my forecast. The production volume of 80,000 BOE per day for 2017 ties to what they have in their April presentation, plus Sanchez has a history of beating their production guidance. Everything is down today because of the $2 drop in oil price.

40% of SN's oil is hedged at $55 for 2017

Actually, my forecast assumes operating cash flow of $3.73/share for 2017, compared to First Call's CFPS forecast of $4.30/share for 2017.

The acquisition from Anadarko is a MAJOR transaction for SN. The Wall Street Gang is often "uncomfortable" when small-caps make of deal of this size. It may take a full quarter of post-acquisition results (the 2nd quarter) before Wall Street gets what is happening here.
Dan Steffens
Energy Prospectus Group
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