Range Resources (RRC)

[dan_s]

I have updated the forecast model for RRC and it will be posted to the EPG website later today.

My valuation is $40.25/share, compared to First Call's price target of $36.24.

On 12/30/2015 Range sold their Nora assets, which raised $865 million. The proceeds were used to lower the company's debt by 24%. Range has a strong balance sheet and a large inventory of low-risk drilling inventory. Cash flow from operations should be approximately $600 million in 2016, enough to cover most of their capital expenditure budget for this year.

RRC has the top leasehold position in the Marcellus Shale play. Netbacks in the Marcellus/Utica have improved thanks to completion of several 3rd party midstream projects that give producers access to better markets and reduce bottlenecks in the region.