Cabot Oil and Gas Corp. (NYSE:COG) was the top performer in the S&P 500 Wednesday, closing up over 7 percent on reports of strong natural gas production at its Marcellus shale projects.
The company said it generated over 400 million cubic feet per day of natural gas production from the fields after it upgraded a compressor station. Before that production came in at 310 million cubic feet a day.
Also helping the company, as well as most of the energy sector, was the boost in oil prices, as light sweet crude oil for July delivery climbed $1.73 to settle at $101.32 a barrel and July Brent crude was up $2.40 to settle at $114.93.
The U.S. Department of Energy also released a report saying U.S. commercial crude inventories rose 600,000 barrels in the week ended May 20, significantly beating the 1.3 million barrel fall in crude stocks projected.
Cabot closed Wednesday at $57.25, gaining $3.78, or 7.07 percent.
Showing posts with label Marcellus Shale. Show all posts
Showing posts with label Marcellus Shale. Show all posts
Thursday, May 26, 2011
Wednesday, February 2, 2011
Anadarko's (NYSE:APC) Amazing Comeback, Are They Fully Priced
After the Macondo well disaster in the Gulf of Mexico, which Anadarko (NYSE:APC) had a 25 percent stake in, with BP (NYSE:BP) holding 65 percent, Anadarko has been soaring, rising from under $35 a share in the early part of June to close at over $80 Wednesday.
Considering Anadarko's potential exposure to fines and lawsuits, it's a remarkable performance. And even without that weighing on the company, it's still a amazing comeback.
While shares in Anadarko have been steadily rising, they got a nice boost on rumors they could be a takeover target of mining giant BHP Billiton (NYSE:BHP). Since that time, the push they received from the speculation has remained, and even been enhanced since the end of 2010.
Also a major factor in the performance of Anadarko, which is helping the overall oil sector, are expectations the price of oil will continue to rise.
Even the loss of business in the Gulf of Mexico hasn't slowed down the company. That's mostly because of their strong onshore projects in Marcellus and Eagle Ford.
The only major thing weighing on Anadarko is their Caesar/Tonga complex, which they co-own with Chevron (NYSE:CVX), Statoil (NYSE:STO) and Royal Dutch Shell (NYSE:RDS-A). The start-up of that asset has been delayed.
What the question is now after the extraordinary run is if the company is now fully priced. Some investors think so, and are going to wait on the sidelines until there's a pullback.
Anadarko closed Wednesday at $80.03, gaining $1.49, or 1.90 percent.
Considering Anadarko's potential exposure to fines and lawsuits, it's a remarkable performance. And even without that weighing on the company, it's still a amazing comeback.
While shares in Anadarko have been steadily rising, they got a nice boost on rumors they could be a takeover target of mining giant BHP Billiton (NYSE:BHP). Since that time, the push they received from the speculation has remained, and even been enhanced since the end of 2010.
Also a major factor in the performance of Anadarko, which is helping the overall oil sector, are expectations the price of oil will continue to rise.
Even the loss of business in the Gulf of Mexico hasn't slowed down the company. That's mostly because of their strong onshore projects in Marcellus and Eagle Ford.
The only major thing weighing on Anadarko is their Caesar/Tonga complex, which they co-own with Chevron (NYSE:CVX), Statoil (NYSE:STO) and Royal Dutch Shell (NYSE:RDS-A). The start-up of that asset has been delayed.
What the question is now after the extraordinary run is if the company is now fully priced. Some investors think so, and are going to wait on the sidelines until there's a pullback.
Anadarko closed Wednesday at $80.03, gaining $1.49, or 1.90 percent.
Wednesday, January 26, 2011
Magnum Hunter (NYSE:MHR) Ready to Soar Says Canaccord
Magnum Hunter (NYSE: MHR) has a powerful asset base and strong growth potential, says Canaccord, and is ready to outperform in their view.
Canaccord says, "We are increasingly constructive on Magnum Hunter’s asset base and relative growth potential. In particular, we are very encouraged by the announced transactions and MHR’s strong start in the Eagle Ford and Marcellus projects. We believe the stock is well positioned to outperform based on its leading exposure to the Eagle Ford, Marcellus, and Bakken oil trends and material catalysts (Eagle Ford wells, bolt-on transactions and JV partnerships). In addition, we continue to encourage investors to note that MHR projects very well into 2012 based on the growth and quality of its 2011 investments."
Canaccord Genuity maintains a 'Buy' rating on Magnum Hunter (MHR), which closed Tuesday at $7.00, down $0.19, or 2.64 percent. Canaccord raised their price target on Magnum Hunter to $8.75.
Canaccord says, "We are increasingly constructive on Magnum Hunter’s asset base and relative growth potential. In particular, we are very encouraged by the announced transactions and MHR’s strong start in the Eagle Ford and Marcellus projects. We believe the stock is well positioned to outperform based on its leading exposure to the Eagle Ford, Marcellus, and Bakken oil trends and material catalysts (Eagle Ford wells, bolt-on transactions and JV partnerships). In addition, we continue to encourage investors to note that MHR projects very well into 2012 based on the growth and quality of its 2011 investments."
Canaccord Genuity maintains a 'Buy' rating on Magnum Hunter (MHR), which closed Tuesday at $7.00, down $0.19, or 2.64 percent. Canaccord raised their price target on Magnum Hunter to $8.75.
Range Resources (NYSE:RRC) Marcellus Shale Results Exceed Expectations
Drilling results for Range Resources (NYSE:RRC) in the Marcellus Shale exceeded expectations says Ticonderoga, but gas prices will keep it from having any meaningful impact on the company in 2011.
Ticonderoga says, "While we have been expecting a strong reserve report from RRC on the back of improving drilling results in the Marcellus Shale, today’s release from the company show results in the Marcellus are better than expected...Our view is that, while we were expecting a relatively strong reserve report, it would be difficult for RRC to move to a premium to the group over the next two quarters given our bearish view on gas prices. Today’s results certainly suggest that RRC’s 2010 reserve growth will be considerably higher than many of its peers, but the impact on relative valuation is unclear. RRC’s proved reserves are still 80% gas weighted and will not benefit from any price improvement as our 2011 gas price outlook is unchanged from 2010. Meanwhile our oil price deck has moved from $80/bbl to $90/bbl, meaning oil weighted E&P’s with strong reserve growth could see a stronger move in NAV."
Ticonderoga reiterates a "Neutral" rating on Range Resources (RRC), which closed Tuesday at $46.54, down $0.18, or 0.39 percent.
Ticonderoga says, "While we have been expecting a strong reserve report from RRC on the back of improving drilling results in the Marcellus Shale, today’s release from the company show results in the Marcellus are better than expected...Our view is that, while we were expecting a relatively strong reserve report, it would be difficult for RRC to move to a premium to the group over the next two quarters given our bearish view on gas prices. Today’s results certainly suggest that RRC’s 2010 reserve growth will be considerably higher than many of its peers, but the impact on relative valuation is unclear. RRC’s proved reserves are still 80% gas weighted and will not benefit from any price improvement as our 2011 gas price outlook is unchanged from 2010. Meanwhile our oil price deck has moved from $80/bbl to $90/bbl, meaning oil weighted E&P’s with strong reserve growth could see a stronger move in NAV."
Ticonderoga reiterates a "Neutral" rating on Range Resources (RRC), which closed Tuesday at $46.54, down $0.18, or 0.39 percent.
Wednesday, January 19, 2011
Range Resources (NYSE:RRC) Looks Range Bound at This Time
Citing NAV and their outlook for gas, Ticonderoga sees Range Resources (NYSE:RRC) struggling in the longer term.
Ticonderoga says, "Adjusting for today’s production and price announcement, we forecast a slight increase in our 4Q10 earnings estimate from $0.18/share to $0.19/share. However, modeling a more rapidly improving price differential for gas in 2011, which is likely tied to growing Marcellus volumes, we are also increasing our full-year 2011 earnings estimates from $1.03 to $1.10/share. Consensus currently stands at: 4Q10- $0.13/share, FY 2011-$0.98/share.
"However, while we think the 2010 NAV growth for RRC will be relatively strong and the company’s shares could perform well around its year-end report, we maintain our longer-term Neutral rating as the valuation gap between RRC and its peers has dissipated, coupled with our bearish outlook for natural gas."
Ticonderoga reiterates a "Neutral" rating on Range Resources (RRC), which was trading at $47.60, down $0.39, or $0.81 percent, as of 1:25 PM EST.
Ticonderoga says, "Adjusting for today’s production and price announcement, we forecast a slight increase in our 4Q10 earnings estimate from $0.18/share to $0.19/share. However, modeling a more rapidly improving price differential for gas in 2011, which is likely tied to growing Marcellus volumes, we are also increasing our full-year 2011 earnings estimates from $1.03 to $1.10/share. Consensus currently stands at: 4Q10- $0.13/share, FY 2011-$0.98/share.
"However, while we think the 2010 NAV growth for RRC will be relatively strong and the company’s shares could perform well around its year-end report, we maintain our longer-term Neutral rating as the valuation gap between RRC and its peers has dissipated, coupled with our bearish outlook for natural gas."
Ticonderoga reiterates a "Neutral" rating on Range Resources (RRC), which was trading at $47.60, down $0.39, or $0.81 percent, as of 1:25 PM EST.
Magnum Hunter (NYSE:MHR) Has Catalyst Galore Says Jefferies (NYSE:JEF)
Citing their exposure to WV Marcellus, Eagle Ford, with their first well in Ohio Marcellus about to come online, Jefferies (NYSE:JEF) sees Magnum Hunter (NYSE:MHR) performing strongly.
Results from Eagle Ford and WV Marcellus are expected to be released soon, which should come back positive.
Even though 2011 may take some time to play out, heading into 2012 Jefferies sees Magnum Hunter's share price soaring.
For full year 2011 they lowered their EPS estimate on Magnum from $0.25 to $0.15, while keep an EPS estimate of $0.15 for 2012.
As for price targets, that has been raised by Jefferies on Magnum in 2012 from $4.80 to $11.
Jefferies maintains a "Buy" rating on Magnum, which was trading at $7.28, down $0.64, or 8.08 percent, as of 12:23 PM EST.
Results from Eagle Ford and WV Marcellus are expected to be released soon, which should come back positive.
Even though 2011 may take some time to play out, heading into 2012 Jefferies sees Magnum Hunter's share price soaring.
For full year 2011 they lowered their EPS estimate on Magnum from $0.25 to $0.15, while keep an EPS estimate of $0.15 for 2012.
As for price targets, that has been raised by Jefferies on Magnum in 2012 from $4.80 to $11.
Jefferies maintains a "Buy" rating on Magnum, which was trading at $7.28, down $0.64, or 8.08 percent, as of 12:23 PM EST.
Thursday, December 23, 2010
EOG (NYSE:EOG), Newfield (NYSE:NFX) Terminate Marcellus Shale Agreement
EOG Resources (NYSE:EOG) and Newfield Exploration (NYSE:NFX) announced they have terminated their agreement originally announced on November 15, 2010 concerning the Marcellus Shale.
Ticonderoga said, "Last night, EOG Resources and Newfield Exploration (Buy-rated), announced that the companies have mutually agreed to terminate their November 15, 2010, agreement regarding EOG's sale of certain Marcellus Shale acreage to NFX. No additional information was given in the release other than the decision falls under the terms provided for in the purchase and sale agreement. We will attempt to get additional information from both companies.
"At the time of the original announcement, we wrote that the deal could take some of the shine off the NFX story, as the transaction appeared to be a step back from the company’s strengths. NFX shares had been performing extremely well, partly because its gas assets were largely held by production, allowing the company to exert more capital discipline, keep spending within cash flow, and concentrate on developing a strong oil portfolio. Although we wouldn’t expect to see a large move in the shares, today’s reversal of the deal should be somewhat viewed as a shift back to those strengths and a net positive for NFX.
"Subsequently, this will likely be viewed as a net negative for EOG, as speculation about why the deal failed will probably center on the assets themselves (such as ownership, quality, or inaccurate data). More concrete is the fact that EOG had previously stated a goal to sell dry gas assets in order to supplement its cash flow needs and/or help repair its balance sheet, which had seen long-term debt jump 36% through the first 9 months of 2010. Today’s announcement adds to the uncertainty of EOG’s 2011 fiscal goals and capital plans."
Ticonderoga maintains a "Neutral" on EOG Resources, which was trading at $91.10, down $1.10, or 1.19 percent, as of 12:02 PM EST.
Newfield Exploration was trading at $73.18, up $0.18, or 0.25 percent.
Ticonderoga said, "Last night, EOG Resources and Newfield Exploration (Buy-rated), announced that the companies have mutually agreed to terminate their November 15, 2010, agreement regarding EOG's sale of certain Marcellus Shale acreage to NFX. No additional information was given in the release other than the decision falls under the terms provided for in the purchase and sale agreement. We will attempt to get additional information from both companies.
"At the time of the original announcement, we wrote that the deal could take some of the shine off the NFX story, as the transaction appeared to be a step back from the company’s strengths. NFX shares had been performing extremely well, partly because its gas assets were largely held by production, allowing the company to exert more capital discipline, keep spending within cash flow, and concentrate on developing a strong oil portfolio. Although we wouldn’t expect to see a large move in the shares, today’s reversal of the deal should be somewhat viewed as a shift back to those strengths and a net positive for NFX.
"Subsequently, this will likely be viewed as a net negative for EOG, as speculation about why the deal failed will probably center on the assets themselves (such as ownership, quality, or inaccurate data). More concrete is the fact that EOG had previously stated a goal to sell dry gas assets in order to supplement its cash flow needs and/or help repair its balance sheet, which had seen long-term debt jump 36% through the first 9 months of 2010. Today’s announcement adds to the uncertainty of EOG’s 2011 fiscal goals and capital plans."
Ticonderoga maintains a "Neutral" on EOG Resources, which was trading at $91.10, down $1.10, or 1.19 percent, as of 12:02 PM EST.
Newfield Exploration was trading at $73.18, up $0.18, or 0.25 percent.
Tuesday, November 23, 2010
Ultra Petroleum (NYSE:UPL) Driven by Marcellus Shale
Jefferies said they consider infrastructure problems and other issues are largely behind Ultra Petroleum (NYSE:UPL), and see acceleration from Marcellus Shale picking up for them going forward.
"Unencumbered acceleration in Marcellus activity should drive shares higher. Infrastructure issues and slowdown in non-op activity have hindered the ramp and held down the stock. We believe these issues are largely in the past," said Jefferies.
Full year earnings for 2010 was raised from $2.29 to $3.23, and for full year 2011, from $2.17 to $2.74. Jefferies maintains a "Buy" rating on Ultra.
They were trading at $47.26, falling by $1.28, or 2.64 percent as of 12:24 PM EST. Jefferies increased their price target on them from $49 to $55.
"Unencumbered acceleration in Marcellus activity should drive shares higher. Infrastructure issues and slowdown in non-op activity have hindered the ramp and held down the stock. We believe these issues are largely in the past," said Jefferies.
Full year earnings for 2010 was raised from $2.29 to $3.23, and for full year 2011, from $2.17 to $2.74. Jefferies maintains a "Buy" rating on Ultra.
They were trading at $47.26, falling by $1.28, or 2.64 percent as of 12:24 PM EST. Jefferies increased their price target on them from $49 to $55.
Tuesday, November 16, 2010
Newfield Exploration (NYSE:NFX) Marcellus Acquisition Could Take Shine Off Story, Buying Opportunity
Newfield Exploration's (NYSE:NFX) acquisition of 50,000 acres from EOG Resources (NYSE:EOG) could trigger selling of shares, according to Ticonderoga, taking some shine off of their overall story.
"NFX is acquiring 50,000 net acres in the Marcellus Shale from EOG Resources (NYSE:EOG) (Neutral) for $405MM. The acreage is located in Bradford County, within the Northeastern section of the play and one of the developing core areas where there has been significant industry activity...The transaction could take some shine off the story, providing an attractive entry point...If so, we would be buying on the sell off as NFX’s strengths in this environment are still very apparent," said Ticonderoga.
Ticonderoga maintains a "Buy" on Newfield.
Newfield was trading at $63.67, falling $1.71, or 2.62 percent at 12:22 PM EST. Ticonderoga has a price target of $75 on the company.
"NFX is acquiring 50,000 net acres in the Marcellus Shale from EOG Resources (NYSE:EOG) (Neutral) for $405MM. The acreage is located in Bradford County, within the Northeastern section of the play and one of the developing core areas where there has been significant industry activity...The transaction could take some shine off the story, providing an attractive entry point...If so, we would be buying on the sell off as NFX’s strengths in this environment are still very apparent," said Ticonderoga.
Ticonderoga maintains a "Buy" on Newfield.
Newfield was trading at $63.67, falling $1.71, or 2.62 percent at 12:22 PM EST. Ticonderoga has a price target of $75 on the company.
Thursday, October 28, 2010
Magnum Hunter (Amex:MHR) Looks Strong on Marcellus, Eagle Ford Trend
Citing Magnum Hunter's (Amex:MHR) significant exposure to Marcellus shale and Eagle Ford trends, Canaccord Genuity maintained a "Buy" rating on them while raising their price target.
Canaccord sees Magnum having a solid 2011.
"We are increasingly constructive on the company’s management team and its relative growth potential in the Eagle Ford and Marcellus trends. In our view, Magnum Hunter is well positioned to outperform based on its leading exposure to the Eagle Ford oil trend and material catalysts (including three initial Eagle Ford well results, Eagle Ford JVs, two initial Marcellus wells, and midstream announcements)," said Canaccord.
Magnum closed Wednesday at $4.76, remaining the same as the prior trading session. Canaccord has a price target of $5.75 on them.
Canaccord sees Magnum having a solid 2011.
"We are increasingly constructive on the company’s management team and its relative growth potential in the Eagle Ford and Marcellus trends. In our view, Magnum Hunter is well positioned to outperform based on its leading exposure to the Eagle Ford oil trend and material catalysts (including three initial Eagle Ford well results, Eagle Ford JVs, two initial Marcellus wells, and midstream announcements)," said Canaccord.
Magnum closed Wednesday at $4.76, remaining the same as the prior trading session. Canaccord has a price target of $5.75 on them.
Monday, October 18, 2010
Ticonderoga Launches Coverage on Range Resources (NYSE:RRC)
Ticonderoga Securities started its coverage of Range Resources (NYSE:RRC) off with a "Buy" rating and a price target of $45, citing strong growth from Marcellus Shale and natural gas price support at current levels.
"RRC is an independent exploration and production company largely weighted toward natural gas, which accounts for 84% of its proven reserve base. While more than half of RRC’s production currently comes from the Mid-Continent/Southwest region of the U.S., the company’s reserves, growth, and upside are dominated by its activities in the Appalachian Basin and its leverage to the developing Marcellus Shale...While we have yet to identify any short-term catalyst for natural gas markets we see little downside in gas prices from here. RRC’s valuation should be viewed as an attractive entry point, especially for longer-term investors."
No one can be exactly sure, but one possible catalyst which could drive gas prices down is the ongoing recession. If people aren't able to afford current prices or incremental increases in natural gas, they will rebel or simply not pay it. Either way it could hurt natural gas companies.
There's a reason many natural gas companies have been buying up oil assets.
Range Resources closed Friday at $37.59, gaining $0.28, or 0.75 percent.
"RRC is an independent exploration and production company largely weighted toward natural gas, which accounts for 84% of its proven reserve base. While more than half of RRC’s production currently comes from the Mid-Continent/Southwest region of the U.S., the company’s reserves, growth, and upside are dominated by its activities in the Appalachian Basin and its leverage to the developing Marcellus Shale...While we have yet to identify any short-term catalyst for natural gas markets we see little downside in gas prices from here. RRC’s valuation should be viewed as an attractive entry point, especially for longer-term investors."
No one can be exactly sure, but one possible catalyst which could drive gas prices down is the ongoing recession. If people aren't able to afford current prices or incremental increases in natural gas, they will rebel or simply not pay it. Either way it could hurt natural gas companies.
There's a reason many natural gas companies have been buying up oil assets.
Range Resources closed Friday at $37.59, gaining $0.28, or 0.75 percent.
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