RE:Long Term TargetsCoachAmI wrote: I know that our long term debt target is $400 million. Does anybody know our long term target for share buybacks/outstanding shares?
That's a great question and not one I've seen answered
Here's what we do know.
Phase 1 = 75% debt, 25% buybacks. To pay off the 200 M in debt from 1b to 800M at 75%, they need roughly 265fcf, so there's 65 to buybacks.
Phase 2 = 50/50 debt buybacks. So that's easy. 400M each way.
So that's 465M in buybacks. How many shares is that? At an average of say 8 bucks, that's 58 million shares, putting the float at well under 500M
Phase 3 = 75% direct shareholder returns. I've not seen anything that provides direction within that 75%. Is all of that dedicated to dividends? To buybacks?
We don't know that. Is there a point at which we stop buybacks?
I've heard a few oil CEOs say something to the effect of "buying back my shares is a prudent use of fcf" because of how undervalued they are.
At 90 wti, the corp decks show just under 600m in fcf. That's about 1.25 a share. Personally, once we hit that debt target, I want most of that money in my pocket by way of a dividend and I will be communicating that to IR.