RE:RE:RE:Should I be concerned? 1:29 AM EDT, 04/22/2022 (MT Newswires) -- Tudor, Pickering and Holt on Friday reiterated its buy rating on the shares of Tourmaline Oil (TOU.TO) and raised its price target to C$74.00 from C$62.00 ahead of the release of first-quarter results from Canada's largest natural-gas producer.
Our updated model ahead of the quarter has our production forecasts unchanged, but tempered cash flow expectations as we bake in higher opex and transportation costs to kick off the year," analyst Matt Murphy said in a note. " For the quarter, we model 505mboepd (Street 505mboepd), with cash flow of C$3.13/shr (Street C$3.18/shr) and capital of C$430MM (Street C$415MM) combining for free cash flow of C$630MM (Street C$660MM). On the returns front, following a previously announced special dividend of C$1.25/shr for the first quarter, our free cash projections for H1'22 has us shaking out in the C$1.50/shr range for a special dividend in the second quarter while remaining within the targeted C$1-1.2B net debt range. For the quarter, we'll be on the lookout for a refreshed 5-year outlook which should feature a healthy uplift in the longer-dated free cash flow outlook as both the Henry Hub/AECO curves have materially improved as well as a continued uplift in the longer-dated JKM curve, with exposure kicking off in early 2023 and providing a healthy y/y uplift on our numbers; on strip pricing, we model a ~19% base + special dividend yield in 2022 and 2023 despite backwardation in both liquids prices and Henry Hub. Lastly, with cash taxability top of mind for investors, we note that our updated model bakes in a ~50% mix of cash tax in our 2023 projections as tax pools are set to dwindle in 2022 on our numbers."