Our Sweet 16 Growth Portfolio gained 4.83% during the week ending June 3rd and it is now up 80.09% YTD.
The S&P 500 Index lost 1.04% during the week and is now down 13.80% YTD.
Since last week I have updated my forecast models and increased my valuations for AR, CRK, CTRA, EQT, OVV and RRC. They all get a high percentage of their revenues from the sale of natural gas and NGLs.
Laredo Petroleum (LPI) was in the red three weeks ago and today it is up 78.01% YTD. They announced a stock repurchase program that drew Wall Street's attention and the "Gang" finally figured out how grossly under-valued the stock was.
Callon Petroleum's (CPE) pullback on a large block sale creates a buying opportunity. It close on June 3rd at 107.6% discount to my current valuation of $120.
Earthstone Energy (ESTE) is starting to draw more attention. Q2 results will be solid.
I will highlight Comstock Resources (CRK) and SilverBow Resources (SBOW) on this afternoon's podcast. Sabrina is enjoying a Family Day today, so the podcast may not be posted until Sunday.
I just posted the Sweet 16 Summary Spreadsheet to the EPG website home page.
Sweet 16 Update - June 4
Sweet 16 Update - June 4
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Sweet 16 Update - June 4
Keep in mind that Q2 is always the lowest demand quarter for natural gas.
Trading Economics:
"US natural gas futures eased to around $8.53 per million British thermal units on June 3, after fresh data showed gas held in storage facilities in the United States increased more than expected in the last week of May. Still, gas prices remain elevated and close to a 14-year high of $9.45, amid strong demand, both domestic and abroad. Russia's war on Ukraine has caused a global energy crunch, with demand for US LNG set to remain elevated partly due to Europe's calls for US exports to help cut reliance on Russia. Meanwhile, average gas output in the US Lower 48 states fell to 94.5 billion cubic feet per day so far in June from 95.1 bcfd in May. That compares with a monthly record of 96.1 bcfd in December 2021, data provider Refinitiv reported. The average amount of gas flowing to US LNG export plants rose to 12.7 bcfd so far in June from 12.5 bcfd in May, compared to a monthly record of 12.9 bcfd in March."
U.S. natural gas production must move over 97 bcf per day to balance supply and demand. Without gas-to-coal fuel switching for power generation, there is no hope of refilling U.S. natural gas storage facilities to a safe level before the next winter heating season begins in mid-November.
Trading Economics:
"US natural gas futures eased to around $8.53 per million British thermal units on June 3, after fresh data showed gas held in storage facilities in the United States increased more than expected in the last week of May. Still, gas prices remain elevated and close to a 14-year high of $9.45, amid strong demand, both domestic and abroad. Russia's war on Ukraine has caused a global energy crunch, with demand for US LNG set to remain elevated partly due to Europe's calls for US exports to help cut reliance on Russia. Meanwhile, average gas output in the US Lower 48 states fell to 94.5 billion cubic feet per day so far in June from 95.1 bcfd in May. That compares with a monthly record of 96.1 bcfd in December 2021, data provider Refinitiv reported. The average amount of gas flowing to US LNG export plants rose to 12.7 bcfd so far in June from 12.5 bcfd in May, compared to a monthly record of 12.9 bcfd in March."
U.S. natural gas production must move over 97 bcf per day to balance supply and demand. Without gas-to-coal fuel switching for power generation, there is no hope of refilling U.S. natural gas storage facilities to a safe level before the next winter heating season begins in mid-November.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group