Reminder: Focus on Cash Flow from Operations
Posted: Wed Jul 29, 2020 11:39 am
Just a reminder that Q2 "Reported Net Income" will be UGLY for all of the companies. < Q2 is the BOTTOM of this oil price dip.
For most of them Q2 will include big non-cash impairment charges and non-cash mark-to-market declines in the value of their oil hedges. As oil prices go up, the value of hedges goes down.
Focus on cash flow. Remember that cash pays the bills, not reported net income.
Also, focus on guidance. It will have the most impact on my stock valuations.
I will be updating my forecast/valuation models as soon as I can. EQT and MTDR have been updated. I will update OVV, OKE and CXO late today or early on Thursday.
For most of them Q2 will include big non-cash impairment charges and non-cash mark-to-market declines in the value of their oil hedges. As oil prices go up, the value of hedges goes down.
Focus on cash flow. Remember that cash pays the bills, not reported net income.
Also, focus on guidance. It will have the most impact on my stock valuations.
I will be updating my forecast/valuation models as soon as I can. EQT and MTDR have been updated. I will update OVV, OKE and CXO late today or early on Thursday.