SM Energy (SM)

[dan_s]

SM Energy Reports Results for the First Quarter of 2015; Announces Agreements to Divest Mid-Continent Assets; Increases Production Guidance on Retained Properties

• Quarterly GAAP net loss of $53.1 million, or $0.79 per diluted share; adjusted quarterly net income of $14.4 million, or $0.21 per diluted share.
• Quarterly adjusted EBITDAX of $311.9 million; quarterly GAAP cash provided by operating activities of $283.9 million. < Cash flow beat my forecast
• Entry into agreements to sell remaining Mid-Continent assets for approximately $324 million with closings expected in the second quarter of 2015.
• SM Energy is maintaining its production guidance range of 60.4 - 63.5 MMBOE for 2015 despite the expected divestiture of Mid-Continent properties due to strong Eagle Ford program performance. < This is VERY GOOD news.

SM Energy was promoted to our Elite Eight, replacing Whiting Petroleum (WLL).

[dan_s]

Stifel rates SM a BUY with a $70 price target.