RE:Share Buy BacksYou got it JD, the release say 25% of "annual FCF. I intrepreted this the same way.
"For 2022, we expect to allocate approximately 25% of our annual free cash flow to direct shareholder returns and intend to implement a share buyback program commencing in Q2/2022."
Now the Q1 average WTI was $80.15 (due to the dip in December from the Covid/SPR impact)...that said I have tracked the YTD WTI contract dates and I get a current average YTD of 83.52.
Call it $165M FCF YTD March 4th....using 25% for buybacks (if our assumption is right) that is a "future expectation to catch-up" of $41M....at today's closing price of $6.08 call it 6.7M shares to grab at a future date?
Again just my rough numbers and assumption on the company statement (as you interpreted also)
A good start nonetheless if correct.
JohnnyDoe wrote: I realized today that I think I misinterpreted their share buy back statement. I was somehow thinking they'd hit a debt target and then start buying back. What they actually said was "For 2022, we expect to allocate approximately 25% of our annual free cash flow to direct shareholder returns and intend to implement a share buyback program commencing in Q2/2022.
They generated 137 fcf in q4. More than that in Q1. Strip pricing at this point is way ahead of forecast. All that fcf already generated but buybacks have not commenced. Yet. For them to hit their goal of 25% of annual 2022 fcf to go towards buybacks, when they start buying back, they're going to have to spend a fair bit more than 25% to get to the 25% target. Wolf's numbers say 3.7m fcf daily at 120 wti. Pretty damn soon they'll be buying back 1M worth of shares every day.