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Platteville, Colorado-based Synergy Resources Corp. (SYRG - Snapshot Report) announced the closure of its previously announced public offering. Synergy Resources priced the upsized public offering of 11,500,000 common shares at $6.25 a piece, including 1,725,000 shares issued and sold as a result of the exercise of all of the underwriters' over-allotment option

The energy explorer plans to use the net proceeds from this offering – approximately $78.3 million after the underwriting discount and estimated offering expenses – to finance the previously announced 18-month capital program, as well as for corporate purposes.

As per Synergy Resources’ spending agenda for the period till Aug 31, 2014, it has budgeted $154 million towards drilling program. Of the total, more than 90% will go toward oil and gas exploration projects in the Wattenberg Field.

Synergy Resources is an independent oil and gas exploration and production company engaged in the acquisition, exploration, and development of oil and gas properties. The company’s operations are concentrated primarily in the Wattenberg Field of the emerging Niobrara shale formation within the DJ Basin of southeast Wyoming and northern Colorado.

Synergy Resources currently retains a Zacks Rank #4 (Sell), implying that it is expected underperform the broader U.S. equity market over the next one to three months. This reflects the company’s string of disappointing results.

In the recently reported fiscal second quarter (three months ended Feb 28, 2013), Synergy Resources delivered a negative 16.7% earnings surprise – the fourth earnings miss in a row – hamstrung by depressed crude prices.

While we expect Synergy Resources to perform below its peers and industry levels in the coming months and see little reason for investors to own the stock, one can look at Oasis Petroleum Inc. (OAS - Snapshot Report), EXCO Resources Inc. (XCO - Snapshot Report) and PetroQuest Energy Inc. (PQ - Snapshot Report) as good buying opportunities. These domestic upstream energy operators – sporting a Zacks Rank #2 (Buy) – have solid secular growth stories with potential to rise from current levels.

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