Gulfport Energy (GPOR)

[dan_s]

First Call's price target has declined just a bit since the company released Q4 results and 2017 guidance two weeks ago.
First Call's price target today is $31.04.

We will be sending out an updated profile on Gulfport later today. I went over my forecast/valuation model carefully and I am sticking with my valuation of $40/share. My valuation assumes that their SCOOP acquisition closes this quarter and that production will ramp up quickly to 180,000 BOE per day (compared to 131,166 BOE per day in Q4 2016.

SCOOP results will be the driving force to a higher share price. Gulfport will run four operated rigs in SCOOP. There is a lot of detail about their plans for SCOOP on the Gulfport website and I highly recommend that your review it carefully as part of your own due diligence.

First Call's adjusted operating cash flow per share is now very close to what I have in my forecast:
2016 actual = $2.98
2017 forecast = $3.65 (compared to First Call's estimate of $3.87)
2018 forecast = $5.37 (compared to First Call's estimate of $5.50)

Gulfport's production is expected to increase 45% to 50% in 2017 and another 20% to 25% in 2018. It has many years of drilling inventory in both the Utica and the SCOOP plays.

[cmm3rd]

Dan,
Are you hearing anything from any of your analyst contacts about GPOR? Just wondering what they think of this selloff, and whether they share your view that positive drilling results (which I assume could be several months away) in SCOOP will be necessary to positively impact the market's perception of the company.

Thanks,

Scott

[dan_s]

In the last 3 months, 9 ranked analysts set 12-month price targets for GPOR. The average price target among the analysts is $31.38. Analysts compare their price target to the current market price of the stock to determine how much potential upside or downside movement there could be in the stock price.

Price targets since the 1-1-2017 range from $29 to $34.

Gulfport has operated rigs running in SCOOP and they are participating in a lot of other wells with good operators. They should have a lot of results to talk about.

[dan_s]

New Report from Credit Suisse just received (dated 3/3/2017)

Reiterate Outperform. We maintain our Outperform rating and $33 TP on GPOR following 4Q16 results. Our NAV-derived target price remains unchanged as lower 2017 Utica well costs and higher YE16 proved reserves were offset by higher 2018/19 service costs assumptions. In tandem with 4Q results, we adjust our 2017/2018 EPS estimates to $1.07/$1.85 per share (from $0.98/$2.20, respectively) to account for lower G&A and LOE expenses in 2017, as well as a lower 2018 rig count due to the recent move in gas futures. We are also introducing our 2019 EPS forecast of $2.92.

Credit Suisse operating cash flow per share forecasts compared to mine in ( ):
2017: $3.80 ($3.65)
2018: $5.91 ($5.37)
2019: $8.19 (N/A)