2 more excerpts from 9/21/21 Stifel report:Pine Cliff Energy (PNE CN) Pine Cliff has quietly been one of the biggest beneficiaries of the latest run in natural gas prices, momentum that now seems like it has the potential to last for more than the summer. For scale, Pine Cliff generated only $9 mm of FFO in the entire 2020, and this year we expect annual cash flow of over $60 mm. With heaps of excess FCF on the offer through our view, the Company can not only eradicate its net debt position, but is showing to build a cash position of over $50 mm by the end of 2023. This newfound flexibility leaves plenty of optionality for a company that could accelerate organic capital projects, contemplate a return of capital, or remind the market of its successful M&A track record with looking at new ideas
Pine Cliff Energy (PNE CN) Our 12-month target price of $0.90/sh is founded on a 3.6x 2022E EV/DACF multiple at the current forward strip. This target offers higher than average implied returns, that when paired with the slightly higher risk profile that comes along with a smaller cap E&P entity in a volatile energy and commodity backdrop, has prompted us to reaffirm our Speculative Buy recommendation.