InPlay Oil (IPOOF) Price Target Update - Sept 8

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Posts: 34908
Joined: Fri Apr 23, 2010 8:22 am

InPlay Oil (IPOOF) Price Target Update - Sept 8

Post by dan_s »

TipRanks 8-16-2023: "Analyst Michael Heim from Noble Financial remains bullish on InPlay Oil Corp. (IPOOF) and has a $6.00US price target. The word on The Street in general, suggests a Moderate Buy analyst consensus rating for InPlay Oil Corp. with a C$8.07 average price target."

InPlay focuses on finding and developing pools with large volumes of oil in place that have low declines and long-life reserves. The Company is primarily targeting the Cardium formation in Alberta. InPlay has a strong balance sheet allowing it to weather commodity price volatility and develop its extensive inventory of horizontal drilling locations.

The Company’s light oil focus properties provide high netbacks and new horizontal development wells payout in ~8 months with WTI oil at $70US/bbl allowing InPlay to fund production growth with strong operating cash flow. The low decline asset base provides a strong foundation on which to build the Company.
Dan Steffens
Energy Prospectus Group
Posts: 34908
Joined: Fri Apr 23, 2010 8:22 am

Re: InPlay Oil (IPOOF) Price Target Update - Sept 8

Post by dan_s »

Doing my due diligence on InPlay Oil today. This is what I found.

At the time of this post, IPO.TO was trading at $2.68Cdn, which compares to my current valuation of $8.11Cdn ($6.00US).

8-15-2023 Canaccord Genuity rated IPO.TO a BUY with a price target of $4.75Cdn

8-16-2023 Noble Research rated IPOOF as OUTPREFORM with a price target of $6.00US (my current valuation)
A combination of negative events led to a 7.6% year over year and 6.1% quarter over
quarter decline in production. Management estimates that the events reduced production by
1,350 boe/day. The decline was larger than expected and led to management taking down
2023 production guidance to 9,100-9,500 boe/day from 9,500-10,000 boe/day. The production
decline is unfortunate but should be viewed as temporary.

New wells coming on should boost production. Six wells have recently, or are about to,
come on line. Initial well production is impressive. In addition, six new wells are planned for the
rest of 2023. Management believes processing constraints should ease in the third quarter.
Higher production, combined with easing processing constraints should help boost cash flow
and earnings.

We are lowering estimates. We have lowered our production, revenues and earnings
estimates in our models to reflect this quarter's results. We would point out that even with a
drop in production and lower energy prices this quarter, operating netbacks (realized prices
less royalties and operating costs) per barrel remain very high at $31.31/boe. Likewise, cash
flow generation as measured by Adjusted Fund Flow remains high.

Long-term outlook and our rating remain positive. While this quarter was somewhat of a
disappointment, we do believe the shortfall was due to events that are temporary and beyond
management's control. We reiterate our OUTPERFORM rating and $6 price target ($8 for the
shares of IPO.CA) on the share of InPlay.

InPlay Oil: Make This Play On The O&G Sector
by Brant Munro, CFA posted to Seeking Alpha
Aug. 21, 2023 10:04 AM ET |
InPlay Oil Corp. (IPO:CA)

Free cash flows may not be as strong as they were in 2022 as commodity prices are weaker.
Stronger commodity prices in the second half of the year should result in stronger returns toshareholders via dividend/buybacks.
I estimate the stock is as much as 264% undervalued and is a screaming buy.
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8-28-2023 Overview: Sentiment and Stocks
Small-cap Alberta oil & gas producer InPlay Oil (IPO) has been moving up the INK Edge rankings, from a mixed INK Edge
outlook at the end of July to mostly sunny this week. Recent insider buying and relatively low valuations have helped it gain
some momentum up the rankings, but it is being limited by poor price momentum. The S&P/TSX Capped Energy Index is up
5.2% over the past six months, but IPO is down 13.1%. The stock currently pays a $0.015 per share monthly dividend which
works out to a 7.3% prospective annualized yield based on Friday's close of $2.45.

InPlay operates in central and west-central Alberta, targeting the Cardium, Belly River, and Duvernay formations. Q2
production averaged 3,658 bbls/day of crude (light and medium), 1,187 bbls/d of natural gas liquids, and about 3,629 boe/d of
conventional natural gas. The total of 8,474 boe/d was down 6.5% from 9,063 boe/d a year earlier due primarily to capacity
constraints at a third-party natural gas processor (about 500 boe/d), wildfires (about 300 boe/d), and third-party facility
turnaround and extended spring break-up road bans (about 550 boe/d). In the first half of 2023, InPlay drilled 8.3 net
extended-reach horizontal wells. It reported a Q2 operating netback of $31.31/boe, down from $61.02/boe a year ago as
commodity prices sagged. InPlay reported net debt of $41.8 million at Q2 end, and according to Refinitiv, it generated
$100.9 million in EBITDA for the 12 months ended June 30th. When reporting Q2 results InPlay downgraded its full-year
guidance. Production is expected to average midpoint 9,300 boe/d (was 9,625) including 4,150 bbls/d (was 4,250) of crude
oil. Capital expenditures are expected to remain unchanged at a midpoint of $77.5 million. We will have to see if the recent
run-up in our rankings earns the stock a place in our August Top Energy report which we will publish this week.
Dan Steffens
Energy Prospectus Group
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