Rosetta Resources (ROSE)

dan_s · Post by **dan_s** » Sat May 11, 2013 2:26 pm

I have updated my forecast model for ROSE and posted it under the Sweet 16 Tab.

My forecast assumes that the acquisition from Comstock Resources (CRK) closes on May 14th. When comparing my EPS and CFPS to First Call's forecasts keep in mind that most analysts do not assume a deal will close until it actually does, therefore the per share data from First Call does not include the increased production or increased share count. It may take months before all the analysts get caught up.

I really like the deal they made with CRK. It was a "Win-Win" with both companies looking a lot better to me after the deal. ROSE will be ramping up drilling in the new Permian Basin assets, so it will become a significant source of growth for them. CRK is using the money from the sale to pick up their drilling in the Eagle Ford.

ROSE hedged a lot more production, so they have reduced their commodity price risk.