GPOR gets two more Upgrades - Jan 18

[dan_s]

Tim Rezvan at Oppenheimer rates it a BUY with a $16.00 price target.
Gabriele Sorbara at Williams Capital rates it a BUY with a $14.00 price target.

Gulfport released Q4 details and I have updated my forecast model. Primarily because of the big drop in share count, Q4 EPS should beat the current First Call estimate ($0.50 EPS) by 8 to 12 cents. My 2019 EPS forecast of $1.75 compares to First Call's estimate of $1.34, again primarily because of the big drop in share count.

My valuation remains $21.00/share and I believe that I am using conservative commodity prices for 2019 and 2020. As more pipelines are completed in the Marcellus/Utica area the gas price differentials to Henry Hub price should continue to decline.

[ChuckGeb]

As I understand it the share acquired in 2018 were about 10% of outstanding. That what you got?

[dan_s]

More than 10% reduction in 2018. The total program should reduce the outstanding shares by 30% by the end of 2020. That is a BIG reduction and obviously will increase EPS.

Gulfport increased production by 25% year-over-year in 2018. Most of their leasehold is now held by production ("HBP") so they can easily live within cash flow, fund an aggressive stock buyback and keep production flat. Based on their guidance, production should be up just 2% to 3% in 2019.

BTW Gulfport has most of their 2019 gas hedged at $2.84/mcf, so I have a high level of confidence in my forecast.