Rosetta Resources (ROSE): An updated Net Income and Cash Flow Forecast has been posted under the Sweet 16 Tab. My updated Fair Value for the stock is shown at the bottom of the forecast.
Rosetta's production was up more than 24% in the 4th quarter. Based on company guidance, their production will be up 40% or more in 2012 with the mix shifting to more liquids.
ROSE
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mdwitte
Re: ROSE
...from a BB I follow...think it applies somewhat to ROSE, doesn't it?
"Reporting NG as BOE should be banned. Its nothing less than legal financial fraud, and a grave misrepresentation on financial reality, peddled by analysts desperate to keep the NG money train of issuing new shares and new debt alive. "
"Reporting NG as BOE should be banned. Its nothing less than legal financial fraud, and a grave misrepresentation on financial reality, peddled by analysts desperate to keep the NG money train of issuing new shares and new debt alive. "
Re: ROSE
The objection to BOE's seems overdone to me. Anyone who doesn't appreciate the difference between liquids and gas is already behind the analytical 8-ball. My own objection is less shrill--I wish companies would just report gas, NG liquids, and oil separately for ease of analysis. And even then, different grades of oil have different prices.
Re: ROSE
Note that I break out the production by crude oil, NGLS and NG at the bottom of my forecast spreadsheets.
The reason boe's are report on a 6:1 basis is because that is the comparable energy content. Six mcf of natural gas has about the same energy content as one bbl of crude oil. I know that the ratio is way out of whack now but that will change. Remember, just a few years ago the ratio was around 4:1 on price during several cold winters.
BTW the 6:1 conversion for reporting boe's is required by GAAP. It is not ment to be price related.
As Tom said, if you don't know the price differentials you should not be investing in these stocks.
The reason boe's are report on a 6:1 basis is because that is the comparable energy content. Six mcf of natural gas has about the same energy content as one bbl of crude oil. I know that the ratio is way out of whack now but that will change. Remember, just a few years ago the ratio was around 4:1 on price during several cold winters.
BTW the 6:1 conversion for reporting boe's is required by GAAP. It is not ment to be price related.
As Tom said, if you don't know the price differentials you should not be investing in these stocks.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
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mdwitte
Re: ROSE
http://finance.yahoo.com/news/Rosetta-R ... 6.html?x=0
...not arguing that an investor can't "tease" the data out of the PR...but you have to look pretty deep to discover that ROSE is 2:1 gas:oil...think they go out of their way to hide their small increase in oil production/reserves, e.g.
" Rosetta replaced 1,039 percent of production from all sources at a reserve replacement cost of $4.58 per Boe." WOW! 1000%! But what was the increase in oil reserves? It may be in there somewhere, but I didn't see it... I'm not even hinting that this is illegal, but DO think the PR was "word-smithed" to accentuate some numbers and gloss-over/hide others...
...not arguing that an investor can't "tease" the data out of the PR...but you have to look pretty deep to discover that ROSE is 2:1 gas:oil...think they go out of their way to hide their small increase in oil production/reserves, e.g.
" Rosetta replaced 1,039 percent of production from all sources at a reserve replacement cost of $4.58 per Boe." WOW! 1000%! But what was the increase in oil reserves? It may be in there somewhere, but I didn't see it... I'm not even hinting that this is illegal, but DO think the PR was "word-smithed" to accentuate some numbers and gloss-over/hide others...
Re: ROSE
As of Dec 31, 2011,
Rosetta estimates proved reserves of 161 MMBoe (54% liquids)
ROSE is now focused on the Eagle Ford. NG is just a by product of these wells. Plus the Eagle Ford gas is high btu so they get premium pricing. Look at the bottom of my forecast model for the production mix in 2012 and 2013.
About 85% of 2012 revenues will be from oil and NGLs.
Rosetta estimates proved reserves of 161 MMBoe (54% liquids)
ROSE is now focused on the Eagle Ford. NG is just a by product of these wells. Plus the Eagle Ford gas is high btu so they get premium pricing. Look at the bottom of my forecast model for the production mix in 2012 and 2013.
About 85% of 2012 revenues will be from oil and NGLs.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group