PDC Energy Update - Oct 11
Posted: Thu Oct 11, 2018 11:01 am
In the last 3 months, 9 ranked analysts set 12-month price targets for PDCE. The average price target among the analysts is $74.38. The nine forecasts have valuations that range from $62 to $86. Three of the nine analysts rate it a HOLD despite their high valuation.
PDCE is a "HOLD" because of Proposition 112 on the Colorado ballot in early November. If it passes, the new drilling step back rules will ban new wells on an estimated 85% of Colorado's DJ Basin, which is where PDCE has most of its undeveloped leasehold.
If Prop 112 does not pass, PDCE will instantly become a "Screaming Buy".
My valuation remains at $90 share. If Prop 112 passes, my valuation will drop to $80 and if it is defeated my valuation will go to $100. My SWAG (a pure guess) is that if Prop 112 passes, there will be a lot of legal challenges that will delay the rules going into effect. If it does pass, EIA's forecast of U.S. oil production growth will need to be lowered because the DJ Basin is one of the top five producing regions in the country.
PDCE is a "HOLD" because of Proposition 112 on the Colorado ballot in early November. If it passes, the new drilling step back rules will ban new wells on an estimated 85% of Colorado's DJ Basin, which is where PDCE has most of its undeveloped leasehold.
If Prop 112 does not pass, PDCE will instantly become a "Screaming Buy".
My valuation remains at $90 share. If Prop 112 passes, my valuation will drop to $80 and if it is defeated my valuation will go to $100. My SWAG (a pure guess) is that if Prop 112 passes, there will be a lot of legal challenges that will delay the rules going into effect. If it does pass, EIA's forecast of U.S. oil production growth will need to be lowered because the DJ Basin is one of the top five producing regions in the country.