CRK Stock

[sundance]

Earlier mistakenly posted "CHK" -- meant "CRK". Since its principal asset is Haynesville gas shouldn't it be worth holding some stock

[Petroleum economist]

Sundance, you can delete the first two posts. Keep the board clean.

Comstock share price
- In 2024 the Comstock share price is up 113.8%, the most of all oil and gas stocks. The increase looks unnatural.
- Comstock is heavily shorted - 27.8% of the shares floating are short.
- I would not be amazed if we are seeing a kind of short squeeze with unpredictable and wild share price variations.

Comstock fundamentals
- Comstock fundamentals do not look good.
- Comstock will be loss making in 2024 (eps = -$ 0.31), even if I take the non-cash hedging losses out.
- My estimate for the Comstock 2025 eps with Henry Hub at $ 3.50/MM Btu is $ 0.66. This gives the current share price of $ 18.92 a very high PE of 19.9.
- If the gas price would go to $ 5.00-6.00/MM Btu things will look better, but then there are so many better choices from the other gas producers.
- The balance sheet is weak and needs reinforcement - the equity ratio is only 37.5% and the 2024 debt/EBITDA ratio will be a frightening high 3.4.
- Shareholder returns are non-existent and as far as I can tell with $ 3.50-3.80/MM Btu gas prices will not happen for another 2-3 years at least.

I am staying well away from Comstock - it looks like gambling, not investing. I see many underperform and sell recommendations from analysts. For once I agree.

Ps: Comstock ranks as 81st out of 84 in my system, almost at the bottom

[dan_s]

I have not taken a close look at CRK in over six months. At this point in time there are much better choices for adding more exposure to natural gas.
I do believe that the recent rise in the share price is just a lot of short covering.

CRK may hold a lot of recoverable reserves in East Texas, but it is not 100% proven at this time.

It remains on my Watch List.

CRGY and OVV are better choices and they both pay dividends.

[bbobber12@yahoo.com]

Thanks for the advice. I have been holding this stock for a while and am finally back to a profit. With the price of natural gas going up I was debating whether to add more or move on to better prospects.

[mrbill]

Any thoughts on SD. the old Chesapeake. Lots of gas.

[ChuckGeb]

I agree with Dan's assessment on CRK and also his top pick for 2025, Crescent Energy. It is well positioned with a lot of gas than can be quickly brought online and directed to Mexico and the LNG Gulf Coast corridor without takeaway constraints. And it is very undervalued imho.

With respect to SD, I lost so much money on this one in the past I would not touch it with a ten foot pole. However the most recent old Chesapeake, EXE is set up very nicely, also imho. Actualkly I believe Sandridge was originally founded by Tom Ward when he left Chesapeake and I think it has evolved thru the bankruptcy process after he departed several years back.