Parsley Energy (PE) Update - July 20

[dan_s]

So far in July, six Wall Street Firms have updated their forecast models and submitted them to Reuters. Their valuations / price targets range from $38 to $49.

PE closed on July 20 at $31.55.

I have updated my forecast/valuation model for Parsley, taking into account some new information from the 7/20 Raymond James deep dive into the Permian Basin takeaway capacity situation. Parsley is in fairly good shape on that front. I have reduced by valuation by just $0.75/share (lowering my forecast realized oil prices in 2H2018 and 2019) a few dollars for an adjusted valuation of $41.50. < This is what I think Parsley's break-up value is today.

There is significant upside to my valuation if Parsley can achieve the high end of their production guidance.

Parsley Energy is a "Aggressive Growth" company with many years of running room in the Permian Basin. Take a hard look at the strong cash flow growth in the RED BOX on the forecast model.