Sweet 16 Update - Aug 19
Posted: Sat Aug 19, 2023 2:58 pm
During the week ending August 18:
> The Sweet 16 gained 3.95% and is now up 14.20% YTD.
> The S&P 500 Index lost 2.82%, but it is still up 13.81% YTD. < Fear of the Fed continues to be an issue.
Today I have "officially" moved Antero Resources (AR) back to my Watch List and moved Diamondback Resources (FANG) from our High Yield Income Portfolio back to the Sweet 16. FANG was first promoted to the Sweet 16 on January 1, 2015, at a price of $59.78. It finished 2015 as one of the top 3 best performing stocks that year. It closed August 18 at a price of $148.04, up 12.68% YTD.
There is nothing wrong with AR, except that I am short-term bearish on natural gas. It will survive the winter and come roaring back a year from now.
FANG has decided to stop paying variable dividends and start buying back more stock. They have an Aggressive Stock Buyback underway that is one of the reasons I think the share price has a lot more upside. The Wall Street Gang loves FANG and it has a strong track record in the Permian Basin.
I have started to see evidence that "Multiple Expansion" has started. Several highly respected energy sector analysts have increased the oil & gas prices used to determine their price targets. First Call reported several significant Sweet 16 price target increases last week.
SilverBow Resources (SBOW) increased $11.00 to $59.75 (my valuation is $75.00).
Vital Energy (VTLE) increased $8.75 to $78.88 (my valuation is $134.00).
Several others saw nice price target updates: ESTE, MTDR, NOG, OVV, PR and SM
SBOW and VTLE both have a low number of shares outstanding, small changes in valuation models have big impacts on their price targets.
Multiple Expansion is the best indicator of a "Paradigm Shift" that the Energy Sector is rotating back into favor. Big Paradigm Shifts = Big Gains for those of us smart enough to see them coming. I think SBOW, VTLE, CPE and ESTE all have the potential to be doubles for us this year.
SBOW and VTLE are still the two smallest companies in the Sweet 16. As I remind you in each of my newsletters, Small-Caps have more risk & they have the most potential.
My Sweet 16 Summary Spreadsheet will be posted to the EPG website late today. It shows my updated valuation for each stock.
No podcast this weekend because I need to save my good stuff for Thursday's live webcast. You must register on the EPG website home page to attend the live webcast. Here is your chance to ask questions about whatever pops into your head.
> The Sweet 16 gained 3.95% and is now up 14.20% YTD.
> The S&P 500 Index lost 2.82%, but it is still up 13.81% YTD. < Fear of the Fed continues to be an issue.
Today I have "officially" moved Antero Resources (AR) back to my Watch List and moved Diamondback Resources (FANG) from our High Yield Income Portfolio back to the Sweet 16. FANG was first promoted to the Sweet 16 on January 1, 2015, at a price of $59.78. It finished 2015 as one of the top 3 best performing stocks that year. It closed August 18 at a price of $148.04, up 12.68% YTD.
There is nothing wrong with AR, except that I am short-term bearish on natural gas. It will survive the winter and come roaring back a year from now.
FANG has decided to stop paying variable dividends and start buying back more stock. They have an Aggressive Stock Buyback underway that is one of the reasons I think the share price has a lot more upside. The Wall Street Gang loves FANG and it has a strong track record in the Permian Basin.
I have started to see evidence that "Multiple Expansion" has started. Several highly respected energy sector analysts have increased the oil & gas prices used to determine their price targets. First Call reported several significant Sweet 16 price target increases last week.
SilverBow Resources (SBOW) increased $11.00 to $59.75 (my valuation is $75.00).
Vital Energy (VTLE) increased $8.75 to $78.88 (my valuation is $134.00).
Several others saw nice price target updates: ESTE, MTDR, NOG, OVV, PR and SM
SBOW and VTLE both have a low number of shares outstanding, small changes in valuation models have big impacts on their price targets.
Multiple Expansion is the best indicator of a "Paradigm Shift" that the Energy Sector is rotating back into favor. Big Paradigm Shifts = Big Gains for those of us smart enough to see them coming. I think SBOW, VTLE, CPE and ESTE all have the potential to be doubles for us this year.
SBOW and VTLE are still the two smallest companies in the Sweet 16. As I remind you in each of my newsletters, Small-Caps have more risk & they have the most potential.
My Sweet 16 Summary Spreadsheet will be posted to the EPG website late today. It shows my updated valuation for each stock.
No podcast this weekend because I need to save my good stuff for Thursday's live webcast. You must register on the EPG website home page to attend the live webcast. Here is your chance to ask questions about whatever pops into your head.