OTCPK:VREYD - Post by User
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Analysis98on Dec 24, 2014 12:55pm
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Post# 23263903
TD Securities target price 13.00 Rated Buy
TD Securities target price 13.00 Rated Buy Some very positive point made in TDs update on TORC. In their analysis, TD assumes oil will average $65.00 for 2015, $70.00 for 2016 and $75.00 for 2017. Cut and paste below.
The $125-mm capex budget is still expected to generate what we view as a modest exit-to-exit production growth of 1% while ensuring the safety of the dividend. In our view, the company’s attractive balance sheet, low leverage and payoutratios, and sustainability metrics should provide investors with comfort that the dividend is safe and is not likely to be cut. The company’s combination of low declinerates, conservatively budget
ed capital efficiency targets, and top-tier netbacks are the cornerstone to one of the most sustainable E&P models in our coverage universe. This is backstopped by a balance sheet that can provide downside protection in an extended period of commodity price weakness.
We also note that TORC has designed a program that can be reduced or accelerated rather easily based on continued weakness (or potential recovery) in commodity prices.