Sweet 16 Update - August 1

[dan_s]

The Sweet 16 Summary Spreadsheet has been posted to the website. You can see how my valuations compare to First Call's price targets.

Five of the Sweet 16 reported 2nd quarter results and I have updated my forecast models for all five. See my previous posts for more details on BTE, BCEI, CXO, RRC and SM. So far, SM has the best quarter with CXO a close second.

I have lowered my valuations for most of the other companies just to recognize the decline in oil prices. I will adjust each one after I have time to update the individual forecast models. It is more important than ever to look at each company's hedge positions, liquidity and drilling commitments. It is also VERY IMPORTANT to remember that oil and gas trade on two totally different markets. Very little attention is being paid to natural gas these days, but the North American gas market should be much tighter this winter. See the presentation slides on RRC's website for more on the gas market.

I will have more in the newsletter which will be sent to EPG members via e-mail on Tuesday morning.

[dan_s]

I forgot to mention that the Sweet 16 was actual up 0.06% last week. Of course, that includes some wild swings as the Bulls and Bears fight it out.

I received a nice analysis of the Iran nuke deal today from a law firm. NONE of the sanctions will be lifted until 2016 no matter what happens. If you want to see the full report, send me an e-mail (dmsteffens@comcast.net)

My take is that Iran is run by terrorist. They cannot be trusted and they have no intention of honoring this deal. They will take the $100 Billion in cash and then cheat like crazy. Obama will leave a mess for the next president.< Just my humble opinion.