Energy Prospectus

Looks like the meeting to approve the merger on November 14 in Houston should be very interesting.

Read these press releases and you'll see that the meeting could get "heated":

CPE's view: https://finance.yahoo.com/news/callon-f ... 00563.html

Paulson's view: https://finance.yahoo.com/news/paulson- ... 00571.html

A few things to remember:
1. When deals of this size close a lot of people / advisers get paid a lot. The "Golden Parachute" payments to CRZO management are not uncommon.
2. As stand alone companies, CPE and CRZO are on-track to generate close to $1.2 Billion of cash flow from operations this year.
3. Size does matter in this business and post merger, CPE will have ~110,000 Boepd of production and should generate $1.3 to $1.4 Billion in 2020 (assuming WTI averages $60/bbl).

Since the merger was announced on July 15th, 8 ranked analysts have submitted details forecast on CPE and set 12-month price targets for CPE of $4.80 to $12.00. The average price target among the analysts is $7.91. The $4.80 valuation is from Drew Venker at Morgan Stanley who is using a very low oil price deck. He has the lowest valuations on almost every company that I look at. The next lowest valuation is $6.00 from Barclays, who is also using a rather low oil price.
The two most recent valuations are from:
> Gabriele Sorbara at Williams Capital on 10/21/2019 who rates CPE a BUY with an $8.00 price target.
> Jeff Grampp at Northland Securities on 10/21/2019 who rates CPE a BUY with a $7.00 price target.

In a detailed report that I get from Stifel dated 9/16/2019 they show net asset valuations of $11.16/share for CPE and $19.51/share for CRZO.

It was reported some outfit just bought 4.5m shares of CRZO.
I would assume there is no reason the merger won't go through??

There is always a chance a merger won't close, but the boards of both companies usually have a high level of confidence that they have the necessary votes. CPE + CRZO makes a lot of sense to me.