RE:RE:Dividend increase for next year...I added more this morning. Management is buying. Always a plus sign.
I hate adding when stock is jumping up but I figure it is impossible to time these things perfectly and long term, this stock is going to be much higher than current levels.
At this point, the market has not woken up fully to what this firm has transformed itself into. This is not your typical shale operation. Lots of waterflood opportunities, etc. Lower decline...huge running room, very low risk, high netback. Production will start from 12Mbbl/day following divestiture, end the year at about 14Mbl/d...from there, how knows? Either a buy in or an increase in debt would allow them to quickly ramp up the drilling. This could easily be a $2Bn market cap company within 18 months in my mind.
Will keep adding on any weakness. This is the best small to midcap name in my mind.
Among small caps, I also own PPY, AAV, CR and DEE for the Montney (LNG) play. DEE is somewhat dead money (no major firm-specific catalysts as they are quite stretched financially) but good rock and solid management. I own MEI.V for a nifty little player with huge running room as well (with their latest deal on PSK) and I own LTS...my major MAJOR mistake which I decided to keep on the hopes it will be taken over within a year or rebound through other asset sales. Avoid the latter at all costs in my mind, it is just for full disclosure. Having it in my portfolio reminds me of avoiding bad management at all cost!
In the US, I like LNREF, a small Eagleford operator that is also doing everything right. Lots of debt unfortunately but is drilling within operating cash flows and slowly adding bolt-on acreage deals in this down market. Very smart management team. I try to buy the team with decent rock to go with it.