Nataly, one of our Super Star MBAs, has finished updating our profile on Comstock and we will be publishing it in the morning.
TipRanks: "Mizuho Securities analyst Vincent Lovaglio maintained a Buy rating on Comstock Resources (NYSE:CRK) on 8/13/2021, setting a price target of $9.00, which is approximately 52.28% above the present share price of $5.91. In its latest earnings report, released on 8/3/2021, the company reported a quarterly revenue of $343.69 million and a net operating earnings of $146.49 million. The company's market cap is $1.38 billion."
During 1H 2021 Comstock generated adjusted operating cash flow of $394.3 million, $1.70/share. Based on higher production and higher realized gas prices over the next six months, I am forecasting that Comstock will generate 2H 2021 operating cash flow of $565.9 million, $2.45/share. So, full year 2021 operating cash flow per share will be approximately $4.15/share.
CRK close on Friday at $5.66. There is NOTHING that justifies the stock trading at less than 2X operating cash flow per share.
On a BOE basis, over 98% of Comstock's production is natural gas.
Comstock Resources (CRK) Update - August 15
Comstock Resources (CRK) Update - August 15
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Comstock Resources (CRK) Update - August 15
Looks like CRK is seeking to sell their Bakken Shale Assets:
https://www.hartenergy.com/exclusives/m ... ity-195579
https://www.hartenergy.com/exclusives/m ... ity-195579
Re: Comstock Resources (CRK) Update - August 15
Good find,I didn't know they had assets there. I would think the market would respond well to a sale. They need to get their debt down.
CLR is in that area and they have cash. 150 m might get it
Comstock Resources retained EnergyNet Indigo for the sale of certain oil and gas properties and related assets located in the Bakken Shale through a sealed-bid offering closing Sept. 2.
The offering includes nonoperated working interest in a 436 well package located in Montana and North Dakota.
Highlights:
Opportunity to acquire highly economic nonoperated working interest in 436 wellbores:
Average Working Interest of ~15.5% and Net Revenue Interest of ~12.6%
427 actively producing wells
Last six-month average net production of ~6,408 boe/d (~56% oil)
Strong cash flow of ~$47.4 million per year (1Q 2021 annualized)
PDP PV-10 $196 million (strip Aug. 3)
2021 Production weighted average by zone:
Bakken Shale ~96%
Three Forks ~2%
Sanish ~2%
Exposure to top Bakken Operators including Continental Resources, Oasis Petroleum, RimRock Energy Partners, Whiting Petroleum
Operating cost reduction of ~5% ($/barrel of oil) 1Q 2021 compared to FY 2020
CLR is in that area and they have cash. 150 m might get it
Comstock Resources retained EnergyNet Indigo for the sale of certain oil and gas properties and related assets located in the Bakken Shale through a sealed-bid offering closing Sept. 2.
The offering includes nonoperated working interest in a 436 well package located in Montana and North Dakota.
Highlights:
Opportunity to acquire highly economic nonoperated working interest in 436 wellbores:
Average Working Interest of ~15.5% and Net Revenue Interest of ~12.6%
427 actively producing wells
Last six-month average net production of ~6,408 boe/d (~56% oil)
Strong cash flow of ~$47.4 million per year (1Q 2021 annualized)
PDP PV-10 $196 million (strip Aug. 3)
2021 Production weighted average by zone:
Bakken Shale ~96%
Three Forks ~2%
Sanish ~2%
Exposure to top Bakken Operators including Continental Resources, Oasis Petroleum, RimRock Energy Partners, Whiting Petroleum
Operating cost reduction of ~5% ($/barrel of oil) 1Q 2021 compared to FY 2020
Re: Comstock Resources (CRK) Update - August 15
NG Inteligence posted an article on CRK
Comstock Resources Inc., which has made its name as a Haynesville Shale natural gas giant, is increasingly bullish on the Bossier formation as part of its strategy.
Of the 21 wells the Frisco, TX-based company turned to sales in 2Q2021, only two were Bossier wells, management said during the second quarter earnings call last week. Those two wells in Sabine Parish, LA, logged initial production rates of 31 MMcf/d and 32 MMcf/d, higher than any of the other wells.
Comstock is also planning to start drilling two Bossier wells in the coming weeks. Each of those would have 15,000-foot laterals.
CFO Roland Burns said the Bossier acreage is underdeveloped relative to its Haynesville footprint, giving it ample room to pursue higher-return long laterals.
“We’ve been thinking about that more long-term because we just have so many wells to drill,” Burns said. “It’s such a large inventory, it’s been hard to go to all the different plays. But it’s a great part of the inventory and I think the market’s starting to realize that. And some of the best wells in the play that are coming out of the Haynesville operators are Bossier wells now.”
CEO Jay Allison also noted other Haynesville pure-plays such as Vine Energy Inc. and Indigo Natural Resources LLC have also recently been chasing the Bossier.
“It’s surfacing,” Allison said.
Comstock reported quarterly production of 1.387 Bcfe/d, 98% natural gas. Output was 8% higher than the previous quarter and 6% higher than 2Q2020.
For the year, Comstock is aiming to produce 1.330-1.425 Bcfe/d, an 8-10% improvement over 2020 levels. To accomplish that, it plans to maintain a five-rig drilling program for the rest of 2021, down from six in May.
Comstock booked $343 million in 2Q2021 revenues from oil and gas sales as production and commodity prices rose. This compared to $179 million in the same period in 2020.
Improved prices and higher production are also expected to help the company exceed its $200 million free cash flow (FCF) target for 2021. Management said FCF would be used to cut debt from the balance sheet.
Comstock booked a net loss of $184.1 million (minus 80 cents/share) compared with year-ago profits of $60 million (29 cents) The most recent loss was largely driven by a $204.8 million hit on hedging contracts. Comstock had 68% of its natural gas production hedged in the second quarter, cutting the realized price from $2.59/Mcf to $2.46. On oil production, 38% was hedged, leading to a realized price of $55.82/bbl instead of $61.25.
About 70% of oil and gas production in the second half of the year is hedged. Burns said 41% of those hedges are collars, which are anticipated to give Comstock greater exposure to current high prices. About 40-45% of 2022 production is hedged, he added, with collars on about half of those hedges.
Comstock Resources Inc., which has made its name as a Haynesville Shale natural gas giant, is increasingly bullish on the Bossier formation as part of its strategy.
Of the 21 wells the Frisco, TX-based company turned to sales in 2Q2021, only two were Bossier wells, management said during the second quarter earnings call last week. Those two wells in Sabine Parish, LA, logged initial production rates of 31 MMcf/d and 32 MMcf/d, higher than any of the other wells.
Comstock is also planning to start drilling two Bossier wells in the coming weeks. Each of those would have 15,000-foot laterals.
CFO Roland Burns said the Bossier acreage is underdeveloped relative to its Haynesville footprint, giving it ample room to pursue higher-return long laterals.
“We’ve been thinking about that more long-term because we just have so many wells to drill,” Burns said. “It’s such a large inventory, it’s been hard to go to all the different plays. But it’s a great part of the inventory and I think the market’s starting to realize that. And some of the best wells in the play that are coming out of the Haynesville operators are Bossier wells now.”
CEO Jay Allison also noted other Haynesville pure-plays such as Vine Energy Inc. and Indigo Natural Resources LLC have also recently been chasing the Bossier.
“It’s surfacing,” Allison said.
Comstock reported quarterly production of 1.387 Bcfe/d, 98% natural gas. Output was 8% higher than the previous quarter and 6% higher than 2Q2020.
For the year, Comstock is aiming to produce 1.330-1.425 Bcfe/d, an 8-10% improvement over 2020 levels. To accomplish that, it plans to maintain a five-rig drilling program for the rest of 2021, down from six in May.
Comstock booked $343 million in 2Q2021 revenues from oil and gas sales as production and commodity prices rose. This compared to $179 million in the same period in 2020.
Improved prices and higher production are also expected to help the company exceed its $200 million free cash flow (FCF) target for 2021. Management said FCF would be used to cut debt from the balance sheet.
Comstock booked a net loss of $184.1 million (minus 80 cents/share) compared with year-ago profits of $60 million (29 cents) The most recent loss was largely driven by a $204.8 million hit on hedging contracts. Comstock had 68% of its natural gas production hedged in the second quarter, cutting the realized price from $2.59/Mcf to $2.46. On oil production, 38% was hedged, leading to a realized price of $55.82/bbl instead of $61.25.
About 70% of oil and gas production in the second half of the year is hedged. Burns said 41% of those hedges are collars, which are anticipated to give Comstock greater exposure to current high prices. About 40-45% of 2022 production is hedged, he added, with collars on about half of those hedges.
Re: Comstock Resources (CRK) Update - August 15
North Dakota Bakken assets are what Jerry Jones contributed to Comstock to gain control of the company. Smart move to sell them now. NOG and CLR may be interested.
Comstock no longer has any near-term debt issues. Sales proceeds would be used to pay down their revolver and drill a few more wells in Q4 to take advantage of high winter gas prices. With a $4 gas price those Bossier wells payout in ~4 months.
CRK trading at less than 2X operating cash flow per share is a "Screaming Buy". As winter approaches the Wall Street Gang will focus more on the "gassers" and they will eventually discover CRK.
XEC's decision to merge into COG (with no gas hedged) looks smarter each day. We will be publishing an updated profile on XEC this week.
I am finishing my review of PXD today. None of their NGLs are hedged (over 155,000 barrels per day). PXD on pace to generate close to $6.5 Billion of operating cash flow this year with over $3 Billion of FCF. The numbers on some of the Sweet 16 are just "stunning" for an old guy like me.
Comstock no longer has any near-term debt issues. Sales proceeds would be used to pay down their revolver and drill a few more wells in Q4 to take advantage of high winter gas prices. With a $4 gas price those Bossier wells payout in ~4 months.
CRK trading at less than 2X operating cash flow per share is a "Screaming Buy". As winter approaches the Wall Street Gang will focus more on the "gassers" and they will eventually discover CRK.
XEC's decision to merge into COG (with no gas hedged) looks smarter each day. We will be publishing an updated profile on XEC this week.
I am finishing my review of PXD today. None of their NGLs are hedged (over 155,000 barrels per day). PXD on pace to generate close to $6.5 Billion of operating cash flow this year with over $3 Billion of FCF. The numbers on some of the Sweet 16 are just "stunning" for an old guy like me.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group