Dan,
Apparently Tutor Jones Pickering downgraded several gassers including AR and EQT. I know you subscribe to multiple services so I'm wondering if you have access to their publications as it would be interesting to hear why they feel a downgrade was warrented.
Thanks
gasser downgrades
Re: gasser downgrades
https://seekingalpha.com/news/3913302-a ... 61324.2536
Downgraded shares to hold from buy with a $47 price target. AR trading at $34.58. Whats wrong with this picture?
Downgraded shares to hold from buy with a $47 price target. AR trading at $34.58. Whats wrong with this picture?
Re: gasser downgrades
IMO there is nothing to justify TPH's downgrade of the gassers. Maybe they believe in Global Warming; it ain't happening this year of even this decade.
I believe in "Climate the Same" and will keep being hot in the summer and cold in the winter. Miss La Nina's colder than normal December is going to push U.S. ngas storage 200 Bcf below the 5-year average by the end of December.
I just finished my review of Coterra Energy (CTRA), which is a "gasser" in our High Yield Income Portfolio.
At the time of this post, CTRA was trading at $27.14. My updated current valuation is $40.00.
All of our gassers (AR, CRK, EQT, RRC, SBOW and CTRA) are going to report strong Q4 financial results and even better Q1 2023 results.
As I've pointed out numerous times in my newsletters and podcasts, the U.S. natural gas market was over-supplied for almost 14 years. The U.S. gas market has rebalanced and likely to be under-supplied in 2023 thanks to increased demand for LNG, coal to gas fuel switching for power generation and more people using gas for space heating year after year. Industrial demand is also increasing because natural gas is the cheapest and cleanest fossil fuel and feedstock for petrocemicals.
Coterra only has ~7% of their 2023 natural gas hedged with collars that have ceilings that average $7.76/MMBtu. CRK is also virtually unhedged in 2023 because they are just using collars for hedging.
Coterra is on track for close to $4 billion of FCF this year, using it to pay big dividends, pay off debt and buyback a lot of stock. All three increase the value of their stock.
I believe in "Climate the Same" and will keep being hot in the summer and cold in the winter. Miss La Nina's colder than normal December is going to push U.S. ngas storage 200 Bcf below the 5-year average by the end of December.
I just finished my review of Coterra Energy (CTRA), which is a "gasser" in our High Yield Income Portfolio.
At the time of this post, CTRA was trading at $27.14. My updated current valuation is $40.00.
All of our gassers (AR, CRK, EQT, RRC, SBOW and CTRA) are going to report strong Q4 financial results and even better Q1 2023 results.
As I've pointed out numerous times in my newsletters and podcasts, the U.S. natural gas market was over-supplied for almost 14 years. The U.S. gas market has rebalanced and likely to be under-supplied in 2023 thanks to increased demand for LNG, coal to gas fuel switching for power generation and more people using gas for space heating year after year. Industrial demand is also increasing because natural gas is the cheapest and cleanest fossil fuel and feedstock for petrocemicals.
Coterra only has ~7% of their 2023 natural gas hedged with collars that have ceilings that average $7.76/MMBtu. CRK is also virtually unhedged in 2023 because they are just using collars for hedging.
Coterra is on track for close to $4 billion of FCF this year, using it to pay big dividends, pay off debt and buyback a lot of stock. All three increase the value of their stock.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group