SM Energy Company
) raised the borrowing base under its senior secured revolving
credit facility from $1.8 billion to $2.2 billion. This is
reflective of the independent oil and gas company's efforts to
increase its financial flexibility.
CHESAPEAKE ENGY (CHK): Free Stock Analysis
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As of Jun 30, 2013, SM Energy had a cash balance of $0.176
million and long-term debt of $1,628.0 million, with a
debt-to-capitalization ratio of 51.6%. In the second quarter of
2013, the company generated $314.1 million of cash from operating
activities versus $222.2 million in the year-ago quarter.
SM Energy's attractive oil and gas investments, balanced and
diverse portfolio of proved reserves and development drilling
opportunities are likely to create long-term value for
In fact, SM Energy is one of the most attractive players in the
exploration and production space. The company's second-quarter
production came in at 131.8 thousand barrels of oil equivalent
per day (MBoe/d). It also showed an improvement of 42.3% from the
year-ago level of 92.6 MBoe/d. The outperformance was mainly
attributable to leasehold expansion in New Ventures along with
acreage additions in its East Texas play and the Powder River
For the third quarter of 2013, SM Energy's production forecast is
12.2 MMBoe/d to 12.8 MMBoe/d. The estimated LOE per Boe is $4.55
to $4.80 while DD&A is projected in the $17.30-$18.50 range.
SM Energy expects 2013 production forecast in the band of
47.3-48.6 MMBoe/d from its earlier guidance of 42.8-44.5 MMBoe/d.
The company intends to increase the liquids composition in its
portfolio, like its peer
Chesapeake Energy Corp.
). As such, liquids are expected to comprise 50% of production by
the end of 2013.
The company also remains upbeat on its New Ventures plan. The
program has already taken additional acreage in the Permian Basin
and in East Texas. These resources have significant potential to
boost its oil-weighted inventory.
Denver, Colorado-based SM Energy Company is an independent energy
company engaged in the acquisition, exploration, development, and
production of crude oil, natural gas, and natural gas liquids in
onshore North America.
SM Energy currently carries a Zacks Rank #3 (Hold). However,
there are other Zacks Ranked #1 (Strong Buy) stocks in the
industry such as
Carrizo Oil & Gas Inc.
Whiting Petroleum Corp.
) that appear attractive for the short term.