Earthstone Energy (ESTE)

[dan_s]

Frank Lodzinski, Earthstone's CEO, will be speaking at our Houston luncheon on Monday, July 16.

If you are going to attend, I recommend that you read our recent profile on the company which you can find under the Sweet 16 tab on our website. You can also find my forecast/valuation model for the company, which I updated on July 4.

If Earthstone's Q2 production comes in close to my forecast (10,700 Boepd) and they stick with their full-year production guidance (12,000 to 12,500 Boepd), then this stock could lead the pack over the next six months. My valuation ($18.25/share) is based on the low end of their production guidance.

First Call's price target this morning is $15.09. It is based on much lower oil prices than we have today.

[dan_s]

Frank sent me the slides that he is going to speak from on Monday. His current management team has been together since the early 1990's. They have successfully built and sold five previous companies. The initial investors in each deal cashed out with a nice return on investment.

7X initial investment on sale of Hampton Resources Corp. (HPTR) in 1996
10X initial investment on sale of Texoil, Inc. (TXLI) in 2001
4X initial investment on sale of AROC, Inc. (private) in 2004
40% IRR on Southern Bay Energy LLC (private) 2005 - 2007 before it was rolled into GeoResources to go public
4.8X initial investment on GeoResources, Inc. (GEOI) that was sold to Halcon in 2012

This team's track record of success is why I moved ESTE into our Sweet 16.

Frank Lodzinski, CEO of Earthstone is speaking at our luncheon on Monday, July 16 in Houston.