Gulfport Energy (GPOR)

[dan_s]

Gulfport is a "gasser". About 80% of this year's production will be natural gas. The good news is that it is high btu gas with a lot of NGL in it AND Gulfport has about 60% of it hedged at good prices. Their realized gas price in the first quarter was $4.57/mcf.

I have updated my forecast model for GPOR and it will be available on the website this afternoon.

I have raised my Fair Value Estimate by $2.25/share to $72.00/share, compared to First Call's Price Target of $57.71.

I believe GPOR deserves a much higher multiple because:
> It has incredible growth locked in. Production grew by 255% year-over-year in 2014 and they are on-track to grow production another 95% this year.
> They have many years of low risk drilling inventory in the Sweet Spot of the Utica Shale.
> They have a big stake in FANG (2.4 million shares)
> They have HUGE upside in the Canadian Oil Sands

If you read the last newsletter, you know the outlook for natural gas prices looks a lot better after this year. If you agree, I highly recommend you take a hard look at Gulfport.