Range Resources (RRC)

[dan_s]

Range Resources is one of three "gassers" in the Sweet 16. Q4 results will be the first full quarter of post-merger results with MRD. That should confirm or change a lot of the assumptions that I am using in my forecast model. I believe I am using rather conservative assumptions today. My Q4 operating cash flow per share forecast is $0.76/share, compared to First Call's forecast of $0.85/share.

Reported production for Q4 is expected to be ~308,000 BOE per day, a 22.5% increase over Q3 production.

Per Range's January presentation, reported production will be 33% to 35% higher YOY in 2017 and grow at 20% each year through at least 2020. Production s/b ~2.2 BCFE per day by 12/31/2017.

I have updated by forecast model for RRC. It will be on the EPG website later today.

I have followed RRC for over 15 years. It joined the Sweet 16 in 2003. IMO it is the #1 natural gas focused upstream company in the world.

My valuation of RRC is $51.00/share, compared to First Call's price target of $47.37.

I believe natural gas and NGL prices could go much higher than what I am using in all of my forecast models for 2017 & 2018, so there is significant upside for RRC.

Those of you concerned about the warm weather: NCEP is now forecasting that winter will return to the eastern U.S. around January 25th.
Check the 10-day forecast for Chicago on https://www.wunderground.com/

As I have posted here many times and I will continue to remind you: Natural gas & NGL supply/demand is going to be MUCH TIGHTER in 2017 because it is not just about the weather.