Vital Energy (VTLE) Update - Jan 16

[dan_s]

My current valuation for VTLE is now $102.00. < VTLE currently trades at $42.08.
> Q4 2023 production beat my forecast by a wide margin.
> Free cash flow for Q4 2023 should be close to $50 million.
> Recent well results have been much better than expected and the Company has more high-quality "Running Room" than it had a year ago.
> I have broken out 2024 by quarter and added my initial forecast for 2025.
> TipRanks' current operating cash flow per share forecast for 2024 is now $30.22 (higher than my forecast of $28.14 CFPS). In my opinion, an upstream company with double digit production growth, that generates close to $250 million PER QUARTER of operating cash flow AND is free cash flow positive should trade for much more than 2X operating cash for per share.
> Vital is a pure play on the Permian Basin, which makes it a takeover target.

TipRanks: "In the last 3 months, 11 ranked analysts set 12-month price targets for VTLE. The average price target among the analysts is $61.33. The 11 price targets range from $46 to $102 per share." < Gabriele Sorbara a 4.5 Star rated analyst at Siebert Williams Shank & Co. is the analyst that agrees with my price target.

TULSA, OK, Jan. 09, 2024 (GLOBE NEWSWIRE) -- Vital Energy, Inc. (NYSE: VTLE) ("Vital Energy" or the "Company") today provided select preliminary results for fourth-quarter 2023, including average daily total and oil production and incurred capital investments. Details for the Company’s fourth-quarter and full-year 2023 earnings release and conference call are provided within this release.

Fourth-Quarter 2023 Preliminary Production and Capital Expenditures

Production. The Company’s fourth-quarter 2023 total production averaged approximately 113.4 thousand barrels of oil equivalent per day ("MBOE/d"), above guidance of 101.8 - 105.8 MBOE/d. Oil production for the quarter averaged approximately 52.8 thousand barrels of oil per day ("MBO/d"), above guidance of 47.9 - 50.9 MBO/d. Production results were primarily driven by outperformance of recently turned-in-line wells in Howard and Upton counties. Earlier-than-expected closing dates for previously announced transactions and the acquisition of additional working interests during the quarter contributed approximately 1,250 BOE/d (60% oil) to quarterly production.

Capital Investments. Total incurred capital expenditures during fourth-quarter 2023 were approximately $190 million, excluding non-budgeted acquisitions and leasehold expenditures, in-line with guidance of $175 - $190 million.

Fourth-Quarter 2023 Average Shares Outstanding

For the three months ended December 31, 2023, diluted weighted-average shares outstanding was approximately 29.8 million. The outstanding 2.0% Cumulative Mandatorily Convertible Series A Preferred Stock (the "Series A Preferred Stock") is included in diluted weighted-average shares outstanding.

As of December 31, 2023, total shares of common stock outstanding was approximately 35.4 million and total shares of Series A Preferred Stock outstanding was 595,104. Share count includes common shares held in escrow related to the Maple and Tall City acquisitions.

[allen46]

I have a huge position in VTLE and am down 17%. I hope this is the beginning of a turnaround in this stock. I can't believe it trades at such a low valuation.