Sitio Royalties Corp. (STR) Valuation Update - June 17

[dan_s]

This morning, I updated my forecast/valuation model for STR. It has been posted to the EPG website under the High Yield Tab.
My valuation is reduced by $0.50 to $33.00/share just because I am using slightly lower oil prices in my forecast models.

I also completed my review of the updated profile for STR. It will be posted to the website and emailed to all EPG members this afternoon.

Sitio Royalties Corp. (STR) is one of the minerals / royalties companies in our High Yield Income Portfolio.

The Company's Q2 2024 results will include almost a full quarter of production from the DJ Basin assets (~2,600 Boepd) that Sitio acquired on April 4th. I now expect STR's 2H 2024 production to average more than 38,000 Boepd.

Based on STR's most recent quarterly dividend that was paid in May of $0.41/share, the annualized yield is ~7.4%.

STR pays variable dividends, which are expected to increase in 2H 2024 thanks to increased production volumes and rising natural gas & NGL prices. The Company's production mix is approximately 50% crude oil, 28% natural gas and 22% NGLs.

[dan_s]

Neal Dingmann at Truist Financial (rated 5 Stars by TipRanks) maintained a Buy rating on Sitio Royalties (STR), with a price target of $33.00.