Sanchez Energy Started at Outperform by Credit Suisse.
These upgrades don't help until oil prices stabilize.
SN gets an upgrade
SN gets an upgrade
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: SN gets an upgrade
Do you know what price deck CS is using for this initiation? It's almost like a bank stress test these days where you have to make some pretty negative assumptions and handicap the upside from that worst case.
Re: SN gets an upgrade
Found it:
"Our NAV estimate is driven by
crude oil and natural gas forecasts as follows: $97.47 per barrel crude and $4.20 per
MMBtu natural gas in 2014, $89 per barrel crude and $4.13 per MMBtu natural gas in
2015, $85.00 per barrel crude and $4.40 per MMBtu natural gas in 2016, and $80 per
barrel crude and $4.50 per MMBtu natural gas in the long term (2017+)."
"Our NAV estimate is driven by
crude oil and natural gas forecasts as follows: $97.47 per barrel crude and $4.20 per
MMBtu natural gas in 2014, $89 per barrel crude and $4.13 per MMBtu natural gas in
2015, $85.00 per barrel crude and $4.40 per MMBtu natural gas in 2016, and $80 per
barrel crude and $4.50 per MMBtu natural gas in the long term (2017+)."
Re: SN gets an upgrade
I'm sure they also consider the hedges each company has in place.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: SN gets an upgrade
Sanchez Energy (SN) slid to a fresh 52-week low of $18.27 on Monday, continuing its recent selloff that has left the stock down more than 30% in the past month alone. However, that pain might be finally coming to an end, writes Credit Suisse’s Mark Lear and Sanya Thapa, who today initiated the stock with an Outperform rating and $35 price target.
http://blogs.barrons.com/stockstowatcht ... s&ru=yahoo
Credit Suisse has a very good energy sector team. They beat the heck out of their models before they put out a recommendation like this, especially when they do it before quarterly results come out..
The SN forecast model that I updated and posted to the website over the weekend includes the impact of their hedges.
In the 2nd quarter, Sanchez Energy's production was 20,427 boepd (72.9% crude oil). Today their production is over 40,000 boepd and on-track to over 50,000 boepd by year-end. My Fair Value Estimate is $43.25/share and there is upside if they reach the upper end of their 2015 production guidance of 53,000 to 58,000 boepd.
Assuming WTI can stabilize in the $85/bbl range, there are going to be a lot of upgrades on the Sweet 16 companies after they release Q3 results. Most of them are trading way below break-up value today.
http://blogs.barrons.com/stockstowatcht ... s&ru=yahoo
Credit Suisse has a very good energy sector team. They beat the heck out of their models before they put out a recommendation like this, especially when they do it before quarterly results come out..
The SN forecast model that I updated and posted to the website over the weekend includes the impact of their hedges.
In the 2nd quarter, Sanchez Energy's production was 20,427 boepd (72.9% crude oil). Today their production is over 40,000 boepd and on-track to over 50,000 boepd by year-end. My Fair Value Estimate is $43.25/share and there is upside if they reach the upper end of their 2015 production guidance of 53,000 to 58,000 boepd.
Assuming WTI can stabilize in the $85/bbl range, there are going to be a lot of upgrades on the Sweet 16 companies after they release Q3 results. Most of them are trading way below break-up value today.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group