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Kodiak Oil and Gas

Posted: Sat May 08, 2010 6:35 pm
by dan_s
I finally got time to listen to KOG's 1st quarter conference call and update my forecast. Kim will be uploading the new forecast tonight.

My Fair Value estimate for KOG is now up to $6.50/share.

They had and excellent first quarter. They are executing on their growth plan. Had it not been for the Market's meltdown on Thursday the share price would have gone up sharply. Kodiak is almost a pure play on the Bakken Shale so it is heavily weighted to oil. As of 3/31 they have no debt and $10 Million cash in the bank. That will change as their 2010 capital program will spend about double their cash flows this year.

Check my forecast model carefully and I think you will agree this is one you want to add on the dip. A big reserve addition is coming at year-end.

Dan

Re: Kodiak Oil and Gas

Posted: Sun May 09, 2010 8:40 am
by mdwitte
I noticed that KOG made $11.85/brl profit (1M/84385) and paid $10.12/brl in stock compensation...so HALF of their profit was paid to insiders...or do I misunderstand the accounting?

Re: Kodiak Oil and Gas

Posted: Sun May 09, 2010 1:42 pm
by dan_s
"Stock Compensation" is a noncash item. It is the amortization of previously approved stock bonus plans. It was not all approved in the current quarter. Most of the companies have it and it is fairly consistent from quarter to quarter.

Paying key employees with stock options is a good idea. It aligns them with the shareholders. Those options are only good if the share price goes up.

Dan