PDC Energy (PDCE)
Posted: Mon Jan 23, 2017 12:16 pm
I have updated my forecast/valuation model for PDCE. It will be posted to the EPG website late today.
My valuation increases by $8.00/share to $112.00. This compares to First Call's price target of $84.81.
PDCE grew production by 43% year-over-year in 2016 and the mid-point of their 2017 production guidance is for at least 40% more production growth this year.
The majority of the company's production today is in the DJ Basin, but their growth over the next few years will come from the Permian Basin. PCDE trades at a much lower multiple of operating cash flow per share than the other Permian Basin companies.
Operating Cash Flow per share:
2015A = $11.85
2016E = $7.16
2017E = $11.03
2018E = $15.41
It is obvious that several of the analyst forecasts submitted to Reuters (First Call) do not include the impact of the company's acquisition that closed in December. After the company releases Q4 results, the average FC price target should move quite a bit closer to my valuation.
My valuation increases by $8.00/share to $112.00. This compares to First Call's price target of $84.81.
PDCE grew production by 43% year-over-year in 2016 and the mid-point of their 2017 production guidance is for at least 40% more production growth this year.
The majority of the company's production today is in the DJ Basin, but their growth over the next few years will come from the Permian Basin. PCDE trades at a much lower multiple of operating cash flow per share than the other Permian Basin companies.
Operating Cash Flow per share:
2015A = $11.85
2016E = $7.16
2017E = $11.03
2018E = $15.41
It is obvious that several of the analyst forecasts submitted to Reuters (First Call) do not include the impact of the company's acquisition that closed in December. After the company releases Q4 results, the average FC price target should move quite a bit closer to my valuation.