PDC Energy (PDCE)
Posted: Sun Dec 31, 2017 8:25 pm
If you are not familiar with PDCE, I highly recommend that you read our recent profile on the company. It is one of the most undervalued upstream companies that I have ever seen. In 2017 their production increased by 45% YOY. Their initial production guidance for 2018 is another 20% to 25% production growth.
In the last 3 months, 5 ranked analysts set 12-month price targets for PDCE. The average price target among the analysts is $62.20. Price targets range from $51 to $81, with the most recent report from Stifel Nicolaus on 12/13/2017 being the $81 target.
PDCE $51.54 on Friday, December 29.
I have updated by forecast/valuation model and it will be on the website on January 1. I am increasing my valuation to $82.00 with more upside if oil stays over $60/bbl.
Thing to know about PDCE:
> Current production is approximately 100,000 Boepd (42% crude oil, 23% NGLs and 35% natural gas).
> Most of the company's production comes from the Wattenberg Field in Colorado's DJ Basin
> Their focus is now on building a 2nd core area in the Delaware Basin where current production is ramping up to 15,000 Boepd
> Cash flow from operations of $580 million in 2017 should increase to $750 million in 2018.
> I am expecting their 2018 capex budget to be approximately $800 million
In the last 3 months, 5 ranked analysts set 12-month price targets for PDCE. The average price target among the analysts is $62.20. Price targets range from $51 to $81, with the most recent report from Stifel Nicolaus on 12/13/2017 being the $81 target.
PDCE $51.54 on Friday, December 29.
I have updated by forecast/valuation model and it will be on the website on January 1. I am increasing my valuation to $82.00 with more upside if oil stays over $60/bbl.
Thing to know about PDCE:
> Current production is approximately 100,000 Boepd (42% crude oil, 23% NGLs and 35% natural gas).
> Most of the company's production comes from the Wattenberg Field in Colorado's DJ Basin
> Their focus is now on building a 2nd core area in the Delaware Basin where current production is ramping up to 15,000 Boepd
> Cash flow from operations of $580 million in 2017 should increase to $750 million in 2018.
> I am expecting their 2018 capex budget to be approximately $800 million