Raymond James issued a new report on 3-18-2019 that explains how they value an upstream company. If you would like to read it, send an email to me at dmsteffens@comcast.net.
From the report: "On a total return basis (growth plus FCF yield) the U.S. E&P business is clearly poised to outperform the broader market. Historically, the broader U.S. stock market return has been around 12-13% - with S&P 500 historical yield of ~6% and S&P 500 historical growth of ~7%. Using current strip oil pricing, U.S. E&P growth plus yield eclipses broader market averages next year and should far exceed the total market returns thereafter. Looking further out to 2025, at today's strip E&Ps would yield ~2x the broader market while growing production by 10%."
Raymond James' oil price forecast is that WTI will top $90/bbl in 2020, but their comments above are based on strip oil prices.
RJ new report on how to value an upstream oil & gas company
RJ new report on how to value an upstream oil & gas company
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group