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Reflecton Jun 14, 2015 11:44am
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RE:Article in globe and mail
RE:Article in globe and mail
BNN MARKET CALL
Three top picks from oil and gas analyst Josef Schachter
Special to The Globe and Mail
Josef Schachter is president of Schachter Asset Management. His focus is oil and gas stocks.
Long Run Exploration (LRE-TSX)
Long Run is a debt-levered energy company that produced >31,000boe/d in 2014 with liquids being 43 per cent of the total mix. To lower debt in 2015 they will spend only 50 per cent of cash flow and use the other $100-million of cash flow to pay down against the debt load of $612-million at year end 2014. In addition they have a number of asset packages out for sale 6-7,000 boe/d total and if just half sells they should be able to knock debt down by another $100-million in 2015. This should then bring exit debt/cash flow below 2x and remove the debt burden worries. Book value at year end 2014 was $3.70 a share and cash flow in 2015 should be >70 cents per share on average volumes of 32,000 boe/d. Our 12 month stock price target is $3.50 a share. We note that in early 2014 the stock traded above $6 a share.
https://www.theglobeandmail.com/globe-investor/investment-ideas/three-top-picks-from-oil-and-gas-analyst-josef-schachter/article23813209/