SM Energy Company
) saw bearish investor reaction to its latest announcement
relating to divestment of all of its properties in the Anadarko
Basin. The stock price moved down nearly 5% to touch $85.07 on
Thursday from $89.27 on Tuesday when the sale was announced.
The properties to be divested - having around 58,000 net mineral
acres - also include the company's Granite Wash interests. These
assets yielded about 8,500 barrels of oil equivalent per day in
the third quarter of 2013, 75% of which was natural gas. The
Anadarko Basin production accounted for about 6% of the company's
total output during the quarter.
SM Energy will sell its Anadarko Basin acreage to various
affiliates of EnerVest, Ltd and will raise cash proceeds of
around $343 million from it. The effective date of this
transaction is Oct 1, 2013. Subject to closing conditions,
purchase price adjustments, and transaction fees the deal is
anticipated to close by the end of 2013.
The company'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
shareholders. We view SM Energy as one of the most attractive
players in the exploration and production space.
The company reported an impressive third quarter with improved
net resource potential in the Eagle Ford and Bakken, and
SM carries a Zacks Rank #1 (Strong Buy). Other peer group stocks
with the same rank that offer value and are worth buying now
TransAtlantic Petroleum Ltd
Matador Resources Company
Northern Oil and Gas, Inc.
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