Veren Inc T.VRN

New Rating!!!!! GLTALongs TD Summary notes

[Mrlongpants]

Crescent Point Energy Corp. (CPG-T) C$9.39
Strong Duvernay Results Confirm Our ExpectationsEvent Reports Q4 Results, YE Reserves, First Duvernay Well Results

Impact: POSITIVE Quarterly Results as Expected: Crescent Point reported Q4 production of 130.4 mBOE/d, which was in line with TD/Consensus expectations (130.3/130.9mBOE/ d). CFPS of $0.72 (net of ARO) was generally in line with the street and modestly stronger than the $0.71 we had anticipated. First Duvernay Well Results Strong, Capital Costs Grind Lower: One catalyst we had been waiting for was the release of Crescent Point's first well results on its recently acquired Kaybob Duvernay asset.
With Q1, the company released its first 100% WI Duvernay result on the assets it purchased from Shell. This pad posted an average IP30 rate of 825 BOE/d (80% liquids) per well.
Furthermore, Crescent Point indicated that capital costs associated with the latest wells has fallen to $8.25 million/well. This is down $2 million from original expectations and $0.5 million from the December update. Our View: This is not simply about IP30 results.
The results combined with much improved capital costs highlight this play will compete with the rest of the portfolio for capital. This should quell the now dated perception among investors that Crescent Point lacks a high-impact play required of a modern oil company of its size. Return of Capital Framework Coming: Although CPG has increased its dividend twice in the past 12-months and recently implemented (and now increased) its NCIB, it previously stopped short of formalizing a capital return framework like some if its peers. With leverage goals likely to be achieved by mid-year, the company indicated it plans to provide a formal return of capital framework at that time. TD Investment Conclusion Crescent Point is in the later stages of a long-term positive transition of its asset base and cost structure. However, its valuation has yet to reflect this material underlying improvement - even using a normalized pricing assumption of only US$65 WTI in 2023 as the basis for our valuation.

[Moemoney42]

"Although CPG has increased its dividend twice in the past 12-months and recently implemented (and now increased) its NCIB, it previously stopped short of formalizing a capital return framework like some if its peers. With leverage goals likely to be achieved by mid-year, the company indicated it plans to provide a formal return of capital framework at that time." Makes sense that they