Sam, Glad to hear you are still onboard here. The last release was good news/bad news but the key point was that they met analysts' projections for 1Q '03 production. For example, Jefferies had them pegged for 20,482 bopd for 1Q and in their PR, EPL is projecting for 1Q production to be in a range of 20,000 to 20,500 bopd. Given the other production scheduled to come on in 2Q and later, together with likely new production from subsequent exploration successes, it would seem that the analysts will be compelled to increase their production estimates for the rest of the year. For example, Jefferies had projected 2Q, 3Q and 4Q production of 20,974, 20,067 and 19,886 boed respectively. Just based on wells already completed they should do much better than the projected 3Q #.
Right now, if you fully load up the diluted shares outstanding by the warrants and convertible preferreds that are in the money, the stock is still trading at about a 3 multiple of cash flow (assuming $4 gas for '03), which is extremely low considering the 3 million $11 warrants are just barely in the money at the current quote.
I believe the analysts will start announcing their opinion upgrades this week, with some new initiations of coverage to come after they announce year-end reserve numbers on 2/6. Hopefully the preferred shareholders will take this opportunity to blow out a lot more of their stock so that we can reduce the amount of the preferred dividends that we will have to pay out from here on. |
