Sweet 16 Updated Valuations - June 8

[dan_s]

Here are my current valuations for the Sweet 16, based on my updated oil & gas price deck, which is already below current prices. Each of the forecast/valuation models now has a table that you can use to plug in any oil & gas prices you wish for 2022 and 2023 and the Excel spread sheet will automatically update the stock valuation. You have to download the Excel spreadsheet forecast model to your computer first. They are all "macro driven".

$ 67.00 ANTERO RESOURCES GAS AR
$125.00 CALLON PETROELUEM OIL CPE
$ 39.00 COMSTOCK RESOURCES GAS CRK
$ 54.00 COTERRA ENERGY GAS CTRA < Will be moving to the High Yield Income Portfolio
$117.00 CONTINENTAL RESOURCES OIL CLR
$ 38.00 EARTHSTONE ENERGY OIL ESTE
$ 71.00 EQT CORP GAS EQT
$181.00 EOG RESOURCES OIL EOG
$233.00 DIAMONDBACK ENERGY OIL FANG < Will be moving to the High Yield Income Portfolio
$160.00 LAREDO PETROLEUM OIL LPI
$ 37.00 MAGNOLIA OIL & GAS OIL MGY
$ 91.00 MATADOR RESOURCES OIL MTDR
$ 61.00 NORTHERN OIL & GAS OIL NOG
$ 90.00 OVINTIV INC. OIL OVV
$153.00 PDC ENERGY OIL PDCE
$ 58.00 RANGE RESOURCES GAS RRC

By Saturday I will select the two companies that are going to replace CTRA and FANG.

[allen46]

Is SWN a possibility?

[dave_n]

Dan, thanks for all the great info. Have you recently looked at CPG (Crescent Point Energy)? Not sure if you're open to another Canadian oil play. In my opinion, it's worth a look through their latest investor presentation. Netback around $60/Boe. Projected excess cash flow for 2022 of $1.2-1.4B using $80-100 WTI. Lots of NOL carryforwards to offset earnings. Plans to reduce debt by $700M from $2B at YE 2021 to $1.3B by end of Q3 2022. Half production hedged through 2022, declining into 2023. They are also in Duvernay. Their presentation is showing excess cash flow projections of $4B by 2024E assuming $80WTI. In full disclosure, I've already purchased it, not trying to talk my book.

[dan_s]

SWN is a possibility, but they still have more balance sheet repair work to do. It will go into the Small-Cap Growth Portfolio first, just so I can watch their progress for a few more quarters. FWIW I attended a presentation by one of their management team a year and a half ago and I thought it was too "WOKE" for a company that at the time was in deep financial trouble. I want management teams that are totally focused on making money for their investors.

CPG is probably great, but there is "just one of me" and I am stretched very thin at this time. I will be making some changes to the Sweet 16 and our other two model portfolios in the next edition of The View from Houston newsletter that I plan to publish June 20.

I urge all of you to share your investment ideas on this Forum. EPG was formed as a "networking group" in 2001.

[mikelp]

two "outside the box" ideas for the Energy HY Income portfolio...

SJT - 100% natgas Royalty Trust, no debt, no hedges, pays monthly distributions, Hilcorp is the operator. Last monthly distribution was based on March natgas sales/pricing. Next distribution declaration date is 6/17

http://www.sjbrt.com/Home/default.aspx

USOI - crude-oil covered call ETN, works well when crude oil prices slowly grind higher...like we have...monthly divy just announced brings forward yield > 40%, goes ex-div 6/21

https://notes.credit-suisse.com/Show/Details/USOI