SilverBow Resources (SBOW) Valuation Update - Mar 28

[dan_s]

My current valuation of SBOW is $58.00, which compares to the PV10 Net Asset Value of $66.39/share < Based only on Proved Reserves per their 3rd party reviewed reserve report.

Proved reserves as of December 31, 2023 which includes the assets acquired from Chesapeake on November 30, 2023
94,958,000 bbls of crude oil
71,236,000 bbls of NGLs
1,677,939,000 mcf of natural gas
445,850,000 Boe < 17.48 Boe per share < 6.52 bbl of liquids per share

Here's how my 2024 forecast compares to TipRanks' current forecast
Revenues: $1,119,142,000 < TipRanks' $1,134,000,000
Net Income per share: $7.42 < TipRanks' $8.73
Operating Cash Flow per share: $23.97 < TipRanks' $25.55

MY TAKE is that if SilverBow's Q1 results - which will be the first full quarter since the Chesapeake Acquisition closed - confirm my forecast model assumptions, a minimum valuation should be 3X operating cash flow per share.

[dan_s]

My guess is that Kimmeridge will not make an all-cash offer for SBOW that is anywhere close to my valuation of $58.00/share. I just don't think they have access to that kind of cash.
This process has drawn attention to SBOW, which is a good thing.
They are going to report a big increase in production from Q4 to Q1.

Good well results and rising natural gas prices heading into year-end should push this stock a lot higher.