Penn Virginia (PVAC) Update - June 13

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dan_s
Posts: 34465
Joined: Fri Apr 23, 2010 8:22 am

Penn Virginia (PVAC) Update - June 13

Post by dan_s »

I have updated my forecast/valuation model for PVAC and posted it to the EPG website. My valuation increases by $5.50 to $35.00 per share.

PVAC closed at $24.50 on June 11.

PVAC is up more than 125% YTD and it still has a lot of upside for us, with over 500 low-risk development drilling locations.
> Even with 60% of their oil hedged with collars that have ceilings in the mid-$50s they are on track to generate close to $7.00/share of operating cash flow.
> They generated free cash flow from operations for five straight quarters Q1 2020 thru Q1 2021 and that trend will continue.
> None of their natural gas or NGLs are hedged, which will give 2H 2021 revenues a big boost.

All of our Small-Caps have lots of upside because they are still trading at very low multiples of operating cash flow. "Multiple Expansion" should be a primary driver for the upstream oil & gas sector as the market gains more confidence in higher commodity prices.
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34465
Joined: Fri Apr 23, 2010 8:22 am

Re: Penn Virginia (PVAC) Update - June 13

Post by dan_s »

Proved Reserves were updated on April 1, 2021 to 136.5 MMBOE with a PV10 value of $1,660 million based on pricing of $55/bbl oil and $2.50/mcf of natural gas. Based on this new reserve report (at $55/bbl oil and their debt as of 3-31-2021) the Company's net asset value PV10 of just their proved reserves (P1) is $34/share.
Dan Steffens
Energy Prospectus Group
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