Divi details to come? There's a good chance that colour and perhaps an initiation of the Divi model will be announced at the Annual Meeting on Wednesday.
TD reports: Expect to see new guidance soon. While we do not have a timeline for revised guidance, the language in the press release suggests that we may see the company pursue a dividend strategy sooner rather than later. In that regard, we could see SGY revise its capex guidance lower in order to flatten corporate decline rates at the expense of drilling new wells, or possibly allocate more capital to waterflood operations that would improve capital efficiencies and mitigate declines (if successful).
Nat Bank reports: Maintaining our Outperform rating and $7.00 target price.
The changes were well received by the market with the stock up ~20% yesterday. No
surprises in Q1 confirms to us that the assets are meeting type curve expectations and
that production is back on track. We look forward to more colour on the transition in the
coming weeks and would advocate buying ahead of the news.
Nat Bank had a face-to-face with Paul Colborne and reported that his key goal over the next few months is to transition the company to the yield growth model with a 10% annual growth expectation.
They may wait before announcing dividends for additional asset sales to bring the balance sheet and production to the point where it can support the dividend.