Sweet 16 Update - April 29

[dan_s]

AR, EQT, MTDR, RRC and SM have announced Q1 results that beat my forecasts, primarily because their realized natural gas prices were higher than what I used in the forecasts. They all generated strong cash flow from operations in Q1 and they should all be able to generate free cash flow this year. They all have lots of running room and strong balance sheets.

For the week ending April 28:
> The Sweet 16 gained 1.21%, but it is still down 8.23% YTD.
> The S&P 500 Index gained 0.93%, and it is up 8.59% YTD.

Extreme volatility in the oil and gas futures market (due to FEAR of recession) is keeping a lot of investors on the sidelines. WTI dipped below $75/bbl, but gained $2.02/bbl on Friday to close at $76.78/bbl. My forecasts and stock valuations are all based on WTI averaging $75/bbl in Q2, $80/bbl in Q3, and $90/bbl in Q4.

The front month NYMEX contract (JUN23) for Henry Hub natural gas gained $0.06/MMBtu on Friday to close at $2.41. The utilities that use gas for power generation are now buyers in the futures market, so ngas prices should drift higher. The DEC23 contract closed at $3.63 on Friday.

EQT Corp. (EQT) and Range Resources (RRC) reported very strong Q1 results. They are two of the four large-cap gassers in the Sweet 16 and two of the five Sweet 16 stocks that are up YTD. EQT Corp. is the largest natural gas producer in the U.S. and it has a very strong hedge book.

We published an updated profile on RRC last week. You should have received it via email.

Permian Resources (PR) is up 11.17% YTD and continues to lead the pack.

Reporting Q1 financial results next week:
May 2: CRK,
May 3: CPE, SBOW
May 4: ESTE, EOG, NOG
May 5: MGY, PR

Today I am working on the newsletter, which I hope to publish on May 2.

[Fraser921]

EQT CEO on CNBC soon 430 ish est

[KGardiner]

For some reason I can't pull up the EOG Profile on the Sweet 16 page.
Kevin

[dan_s]

I just check the website and the EOG forecast model is under their logo under the Sweet 16 tab. You do have to log on to get to it.

If you still can't download it, send me an email and I will send it to you. dmsteffens@comcast.net