Goodrich Petroleum (GDP) Update - June 9

Goodrich Petroleum (GDP) Update - June 9

Postby dan_s » Wed Jun 09, 2021 1:31 pm

Over the next two weeks I will be taking a hard look at each of the companies in our Small-Cap Growth Portfolio.

GDP is trading for $11.24 at the time of this post. TipRanks' valuation is $18.00, but it is based on four analysts' reports that don't include the recent surge in the NYMEX strip for natural gas and NGL prices. I am increasing my valuation by $5 to $30.00/share. My updated forecast/valuation model for GDP has been posted to the EPG website.

Assuming a realized natural gas price of just $2.75/mcf (net of cash settlements on their hedges), Goodrich should generate $7.00 to $7.20 per share of operating cash flow this year based on their most recent production guidance. So, this stock is trading for less than 2X operating cash flow.
> The balance sheet is in good shape.
> They are generating free cash flow from operation today AND are on pace to increase production by 20% YOY.
> They have a lot of low-risk high-return development drilling locations.
> Based on today's NYMEX strip, there is significant upside to my 2022 forecast.

We will be publishing an updated profile on GDP tomorrow morning.

If you are not familiar with this profitable "gasser", I highly recommend that you watch the replay of the webinar that Goodrich hosted for us on 3-12-2021. It is now available to anyone at this YouTube link:
Dan Steffens
Energy Prospectus Group
Posts: 25582
Joined: Fri Apr 23, 2010 8:22 am

Re: Goodrich Petroleum (GDP) Update - June 9

Postby Fraser921 » Thu Jun 10, 2021 7:24 pm

Silverbow got top awards today up 7.8%, in 2nd place GDP up 4.35%, (Thank you Dan)

If GDP approaches 20 the high cost 2nd lien debt converts to equity which would be extremely good news. GDP put 3 mega wells online late q1 which will drive volumes and ebitda
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Joined: Mon Mar 22, 2021 11:48 am

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