I was a bit disappointed with Cimarex Energy (XEC) first quarter results but then I see they have a ton of wells that are waiting on completion at the end of the quarter. A shortage of frac crews, proppants and acid in the Permian and Granite Wash are causing delays in getting wells completed. Bad weather in West Texas also caused a lot of problems. It is dry as a bone out there now. Production was down slightly in Q1 but that will be fixed as they get all these new wells on-line and keep drilling.
They are having success in SE New Mexico, which is good for micro-cap Cross Borders Resources (XBOR). XEC will be drilling two or three JV wells with XBOR this year.
XEC has a rock solid Balance Sheet. Very little of their production is hedged (none beyond 2011). If you think oil and gas prices are going higher, XEC is for you.
I will be on their conference call at noon and my updated forecast should be on the website late this afternoon.