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Gold/Mining/Energy : t. upton resources
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To: Method who wrote (81)3/1/2000 2:46:00 PM
From: SofaSpud   of 86
 
I guess it depends on how you look at it. If you annualize Q4 CF, yep, it's cheap.

Now don't get me wrong -- I'm long, and I don't think the current price is appropriate. But I think people are taking a much longer-term view these days. And the question is, how is Upton going to get off the treadmill? How are they going to sustain long-term growth? It's great that they've got production from horizontal wells coming on at a time when spot prices are through the roof. But that's just a short-term hit, 'cause that production declines real fast. If they carry on the way they are, spending cash flow and maxing out their lines, then they enter the next price slump (in a year or two years or whenever it is)with too much debt. Unless they find something other than small wells with rapid declines.

Tell me where I'm wrong, please. But at this point I don't see how Upton gets to the next level.
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