RSP Permian - Update Jan 22
Posted: Mon Jan 22, 2018 10:00 am
I just received the following note from John White at Roth Capital:
We have input our higher 2018 WTI crude oil price estimates into our valuation model which results in a NAV of $50.42 per share which we have rounded to $50.50 for our new price target. Our previous price target was $44.00. We have moved our 2018 oil price estimate to be more in line with the recent futures markets. Our 2018 WTI crude price estimate moves from $46.25/bbl to $56.25/bbl. < My valuation of RSPP is $46.50 - Dan.
We have also updated our 4Q 2017 estimates for actual WTI crude oil and Henry Hub natural gas prices. Accordingly our 4Q 2017 estimates for EPS/CFPS/EBITDA move higher from $0.16/$0.80/$148.1 million to $0.35/$1.04/$177.0 million. < This is very close to my Q4 2017 forecast for RSPP - Dan.
The application of our higher 2018 WTI crude oil price estimates increases our 2018 projections of EPS/CFPS/EBITDA from $1.18/$4.06/$747.5 million to $1.97/$5.02/$874.1 million.
Note that John's operating cash flow per share estimate ("CFPS") for 2018 compares to my forecast of $4.62. My forecast models are still based on $50 WTI beyond Q1 2018. All of my valuations for the Sweet 16 will very likely be going up after I see Q4 results and adjust the oil, gas and NGL prices being used in the models.
We have input our higher 2018 WTI crude oil price estimates into our valuation model which results in a NAV of $50.42 per share which we have rounded to $50.50 for our new price target. Our previous price target was $44.00. We have moved our 2018 oil price estimate to be more in line with the recent futures markets. Our 2018 WTI crude price estimate moves from $46.25/bbl to $56.25/bbl. < My valuation of RSPP is $46.50 - Dan.
We have also updated our 4Q 2017 estimates for actual WTI crude oil and Henry Hub natural gas prices. Accordingly our 4Q 2017 estimates for EPS/CFPS/EBITDA move higher from $0.16/$0.80/$148.1 million to $0.35/$1.04/$177.0 million. < This is very close to my Q4 2017 forecast for RSPP - Dan.
The application of our higher 2018 WTI crude oil price estimates increases our 2018 projections of EPS/CFPS/EBITDA from $1.18/$4.06/$747.5 million to $1.97/$5.02/$874.1 million.
Note that John's operating cash flow per share estimate ("CFPS") for 2018 compares to my forecast of $4.62. My forecast models are still based on $50 WTI beyond Q1 2018. All of my valuations for the Sweet 16 will very likely be going up after I see Q4 results and adjust the oil, gas and NGL prices being used in the models.