Gulfport (GPOR)

[dan_s]

I was looking over the Sweet-16 last night and Gulfport jumps out at me as one that could make a big run for us this quarter.

Gulfport is heavily weighted to oil, 3rd quarter results should be rock solid with a nice jump in production and we are now past hurricane season.

GPOR has one major risk. A high percentage of its production comes from shallow bay waters along the Louisiana Gulf Coast. Their production has been shut-in before by hurricanes and that is always a risk. It is now very unlikely there will be a hurricane that effects that area.

Also, GPOR is now developing their Permian Basin leasehold and they will soon be drilling Niobrara oil wells.

GPOR also has 2,000 bopd hedge at $57.35/bbl under a forward sales contract that expires December 31, 2010. When that hedge expires they will get a significant boost in revenues. GPOR has a rock solid Balance Sheet and their cash flow from operations exceeds their capital expenditures.

My Fair Value for GPOR is $22/share.

Dan