Sweet 16 Update - Nov. 9

[dan_s]

An updated Sweet 16 spreadsheet has been posted under the Sweet 16 tab on our main website.
> Tab 1 of the spreadsheet is a summary of the EPS and CFPS forecasts,
> Tab 2 shows our Fair Value Estimate compared to First Call's Price Target for each company as of 11-9-2013

It is an Excel spreadsheet that EPG members can download and print.

I spent all week updating the individual forecast models for the Sweet 16. They all reported "solid" to "outstanding" 3rd quarter results. GTE reports on November 12, but they already reported Q3 production so my forecast should be very close to what they report. If you are not familiar with GTE, you should read our profile. The company is based in Calgary. They have a major oilfield ("Moqueta") coming on-line in the next few months that will jack up production in 2014 and a major oil discovery (~80 MMBO) that should be developed in 2015.

Our three largest oil shale companies (EOG, CLR and WLL) all reported outstanding results from Plug-N-Perf completions that should significantly increase recoverable oil per section. I think all three are Strong Buys at today's share price. All three are "Core Holding" quality companies.

Bonanza Creek (BCEI), up 82% YTD, is the leader of the pack. I continue to be impressed by their production growth and their large inventory of low risk stacked pay locations in the Niobrara. This company is run by a bunch of petroleum engineers and it shows.

SM Energy (SM) really looks good to me. My valuation of $135/share is probably way too low.

We will publish a newsletter on Monday, so I don't want to give too much away here.

PS: I will in Dallas on Wednesday at our luncheon. If you live in the area, I hope to see you there and don't forget to register on-line.