Energy Prospectus

This is close to what I expected when you add back the non-cash impairment charge. - Dan

Comstock reported net income of $129.7 million or $2.68 per share. Included in net income was a net gain on sale of the Company's West Texas properties of $230.6 million ($149.9 million after tax or $3.21 per share). Comstock reported a loss related to its continuing operations of $21.5 million or 45¢ per share for the three months ended June 30, 2013 as compared to income from continuing operations of $16.7 million or 35¢ per share for the three months ended June 30, 2012.

The second quarter of 2013 results from continuing operations include an impairment of oil and gas properties and unevaluated leases of $10.1 million ($6.6 million after tax or 14¢ per share) and an unrealized gain from derivative financial instruments of $0.6 million ($0.4 million after tax or 1¢ per share).

Best news is the results they are getting in the Eagle Ford in South Texas. CRK should have a much better production mix by year-end. - Dan

Since the beginning of 2013, the Company has completed 25 (15.4 net) horizontal Eagle Ford shale wells including six (3.8 net) wells drilled in 2012. The 25 Eagle Ford shale wells that were completed had an average per well initial production rate of 796 barrels of oil equivalent ("BOE") per day. The four wells with the highest initial production rates were Forrest Wheeler C #1H, Swenson B #1H, Swenson A #1H and Swenson B #2H. These wells are located in McMullen County and had initial production rates of 1,337, 1,322, 1,222 and 1,143 BOE per day, respectively. Beginning in June, the Company had six operated rigs drilling in the Eagle Ford shale program, an increase from the three rigs that were drilling in the first quarter.

The two natural gas wells were completed in the Bossier shale formation in DeSoto Parish, Louisiana in July and had an average per well initial production rate of 9 million cubic feet of natural gas per day under a restricted 16/64 inch choke.

CRK is on-track to generate over $6.00 cash flow per share. The recent asset sale to ROSE shores up their balance sheet and they are rapidly increasing their oil production by drilling lots of Eagle Ford wells.

An updated Net Income & Cash Flow Forecast model, with my adjusted Fair Value Estimate, can be found under the Watch List Tab.

First Call's price target is $22.36.