Swift Energy (SFY)

[dan_s]

An updated profile for Swift Energy (SFY) has been posted under the Sweet 16 Tab.

I took a hard look at Swift Energy over the weekend. CFPS is solid and they should report good Q4 results.
The company's 3rd quarter production was down a bit from Q2 as a result of hurricane Isaac related shut-ins. The company also announced a slow down in their capital program to re-evaluate their direction in the Eagle Ford Shale. In this unforgiving market the share price dipped as a result.

I still think SFY looks very good, however I have trimmed my Fair Value Estimate down.
1. Q4 production will rebound since all of the hurricane issues are behind them and several Eagle Ford wells will be completed in the 4th quarter.
2. Year-end proven reserves should be up ~20%, which will lower the DD&A rate in 2013 and improve reported earnings.
3. CFPS should be over $8/share in 2013, so share price is now just 2X CFPS
4. First Call's Price Target is $28.25. My adusted Fair Value Estimate is in the profile.

I will be moving SFY to our Small-Cap Portfolio, to make room for a mid-cap that I'm working on.