Callon Petroleum Company recently closed the Ward County acquisition deal with Cimarex Energy Co. — to expand its footprint in the Delaware Basin — for a cash payment of around $538.6 million. Callon Petroleum updated its full-year 2018 guidance to incorporate the Delaware Basin acquisition.
Here are the details of the updated guidance:
Production: Callon Petroleum expects its full-year output in the band of 31.5-33 thousand barrels of oil equivalent per day (MBoe/d), higher than the prior guided range of 29.5-32 MBoe/d. Moreover, the estimated production is pegged much higher than 2017 actual figure of 22.9 MBoe/d. Per the company, 76% of the total output is expected to be oil.
Apart from the impact of the acquisition, Callon Petroleum’s expected surge in output can also be attributed to a strong performance from its Spur area assets. This has helped the company to increase its midpoint of the output guidance by 1,500 barrels of oil equivalent per day (Boe/d).
The company has reiterated its output target for the fourth quarter of 2018 at more than 40 MBoe/d.
Lease Operating Expense: Callon Petroleum expects its lease operating expense (LOE) in the range of $5.00-$6.00 per barrel, down from the previous guidance of $5.25-$6.25. The company lowered the guidance by 4%, keeping in mind the incremental advantage from its investments in strategic initiatives.
Wells on Production: The net operated horizontal wells placed into production for full-year 2018 is expected in the range of 47-50, up from the prior guided level of 43-46, and much higher than 2017 figure of 37.
Capital Expenditure: Following the acquisition, — which added 28,000 net surface acres — full-year capital expenditure for operational purposes has been revised upward to a new range of $530-$560 million from $500-$540 million expected earlier.
Price Performance
Callon Petroleum has gained 7.3% over the past year compared with 19.4% collective growth of the industry it belongs to.
Zacks Rank & Stocks to Consider
Currently, Callon Petroleum has a Zacks Rank #3 (Hold). Investors interested in the energy sector can opt for some better-ranked stocks like McDermott International, Inc. and Subsea 7 S.A. (SUBCY - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Houston, TX-based McDermott is an equipment provider for energy companies. The company’s top line for 2018 is likely to improve 145% year over year. In the last four reported quarters, the company delivered an average positive earnings surprise of 101.7%.
Luxembourg-based Subsea is an oilfield service providing company. In the last four reported quarters, the company delivered an average positive earnings surprise of 318.6%.
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Callon Petroleum Company recently closed the Ward County acquisition deal with Cimarex Energy Co. — to expand its footprint in the Delaware Basin — for a cash payment of around $538.6 million. Callon Petroleum updated its full-year 2018 guidance to incorporate the Delaware Basin acquisition.
Here are the details of the updated guidance:
Production: Callon Petroleum expects its full-year output in the band of 31.5-33 thousand barrels of oil equivalent per day (MBoe/d), higher than the prior guided range of 29.5-32 MBoe/d. Moreover, the estimated production is pegged much higher than 2017 actual figure of 22.9 MBoe/d. Per the company, 76% of the total output is expected to be oil.
Apart from the impact of the acquisition, Callon Petroleum’s expected surge in output can also be attributed to a strong performance from its Spur area assets. This has helped the company to increase its midpoint of the output guidance by 1,500 barrels of oil equivalent per day (Boe/d).
The company has reiterated its output target for the fourth quarter of 2018 at more than 40 MBoe/d.
Lease Operating Expense: Callon Petroleum expects its lease operating expense (LOE) in the range of $5.00-$6.00 per barrel, down from the previous guidance of $5.25-$6.25. The company lowered the guidance by 4%, keeping in mind the incremental advantage from its investments in strategic initiatives.
Wells on Production: The net operated horizontal wells placed into production for full-year 2018 is expected in the range of 47-50, up from the prior guided level of 43-46, and much higher than 2017 figure of 37.
Capital Expenditure: Following the acquisition, — which added 28,000 net surface acres — full-year capital expenditure for operational purposes has been revised upward to a new range of $530-$560 million from $500-$540 million expected earlier.
Price Performance
Callon Petroleum has gained 7.3% over the past year compared with 19.4% collective growth of the industry it belongs to.
Zacks Rank & Stocks to Consider
Currently, Callon Petroleum has a Zacks Rank #3 (Hold). Investors interested in the energy sector can opt for some better-ranked stocks like McDermott International, Inc. and Subsea 7 S.A. (SUBCY - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Houston, TX-based McDermott is an equipment provider for energy companies. The company’s top line for 2018 is likely to improve 145% year over year. In the last four reported quarters, the company delivered an average positive earnings surprise of 101.7%.
Luxembourg-based Subsea is an oilfield service providing company. In the last four reported quarters, the company delivered an average positive earnings surprise of 318.6%.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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