Whiting / Kodiak Merger

[dan_s]

Kodiak Oil & Gas (KOG): An updated Net Income & Cash Flow Forecast model has been posted under the Watch List Tab.

I needed to update this one, so I can work on the consolidated forecast for Whiting tomorrow.

My Fair Value Estimate for KOG is $17.10, compared to First Call's Price Target of $16.69.

The merger with WLL is 99% sure to happen, so the KOG share price will move with WLL until the merger is final. If you own KOG, I recommend hanging tight and taking the WLL shares. I think WLL has a lot of upside for us.

On a stand alone basis, KOG had a very strong quarter. Production was up more than 4,000 boepd despite the tough weather in North Dakota. Production growth is likely to exceed what I show in the model for Q3, but I did not want to go over the midpoint of their official guidance. KOG's production is on-track to top 50,000 boepd (86% crude oil) by year-end.

[dan_s]

Whiting Petroleum (WLL): An updated profile and an updated Net Income & Cash Flow Forecast model have been posted under the Sweet 16 tab. This one has a lot of upside for us. Read the profile carefully.

[setliff]

article focuses negatively on large debt incurred with merger

http://seekingalpha.com/article/2451675 ... n?uprof=46

[dan_s]

They also got a heck of a lot of proven reserves and P2 reserves that are about as close to P1 as you can get.

Whiting's balance sheet can easily handle the debt.

What I like most is that Whiting is a better operator than KOG. They will lower F&D costs, raising the value of the acreage.