Energy Prospectus

HOUSTON, Nov. 6, 2014 (GLOBE NEWSWIRE) -- Carrizo Oil & Gas, Inc. (CRZO) today announced the Company's financial results for the third quarter of 2014 and provided an operational update, which included the following highlights:

• Record Oil Production of 20,000 Bbls/d, 64% above the third quarter of 2013

• Record Total Production of 33,587 Boe/d, 12% above the third quarter of 2013

• Record Oil Revenue of $173.3 million, representing 88% of total revenue, and 47% above the third quarter of 2013

• Record Total Revenue of $196.2 million, 36% above the third quarter of 2013

• Income From Continuing Operations of $83.0 million, or $1.80 per diluted share, and Adjusted Net Income (as defined below) of $31.8 million, or $0.69 per diluted share

• Record Adjusted EBITDA (as defined below) of $146.4 million, 27% above the third quarter of 2013

• Raising 2014 crude oil production growth target to 63% < This is the best news

An updated Net Income & Cash Flow Forecast model for CRZO has been posted under the Sweet 16 Tab.

This company is really clicking and they have learned that it is best to "under-promise and over-deliver". They are focused on increasing their crude oil production in the Eagle Ford and that trend is going to continue. Oil production was 20,000 bbls per day in Q3 and it should be over 22,000 bbls per day in Q4. With 65% of their Q4 oil hedged at $92.22/bbl and natural gas and NGL prices drifting higher, Q4 results will be quite strong.

In addition to getting production up, they are doing a good job of getting their costs down. Lease operating expenses are now under $7.00/boe of production, which is very good.*

I am raising my Fair Value Estimate $1.00 to $83.25, compared to First Call's Price Target of $69.72.

*I got an article this week from one of our members that said operating expenses (LOE + Severance Taxes + Transportation & Marketing) was over $40/bbl in the shale plays. That is total crap. It is closer to $20/bbl. All of the stuff you see in the press that says the E&P companies cannot make money in the shale plays if oil drops to $70/bbl is a bunch of nonsense. The Sweet 16 will not only survive if oil goes that low (which I do not believe will happen), but they will thrive. All of the "gloom and doom" articles I've seen are not considering individual company's production mix and their hedging programs.