Magnolia Oil & Gas (MGY) Update - Nov 12

Magnolia Oil & Gas (MGY) Update - Nov 12

Postby dan_s » Fri Nov 12, 2021 12:53 pm

MGY was trading at $20.27 at the time of this post.
I have updated my forecast/valuation model for Q3 results and the company's guidance. My valuation increases by $1 to $24 per share.

MGY is now totally unhedged.
> Production should be up ~1,500 Boepd from Q3 to Q4 and their 2021 exit rate should be over 70,000 Boepd.
> Production mix is approximately 45% crude oil, 32% natural gas and 13% NGLs.
> They are using FCF to buyback shares and de-leverage the balance sheet.
> My operating CFPS forecast is now $4.67 and a reasonable 12-month price target is 6X operating CFPS.

MGY is a strong candidate for promotion to our Sweet 16 because of its size and potential for annual production growth of 10% to 15% for many more years.

TipRanks: "In the last 3 months, 8 ranked analysts set 12-month price targets for MGY. The average price target among the analysts is $23.75. The price targets range from $21 to $26."
Dan Steffens
Energy Prospectus Group
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