Q: Hi there,
Surge Energy, it is more of an oil play or a natural gas play. Do you see upside on Surge Energy as the current events is driving up energy cost. Also, the market is bullish on natural gas, do you agree.
Thank you in advance for taking the time to answer my question.
NL
Surge Energy, it is more of an oil play or a natural gas play. Do you see upside on Surge Energy as the current events is driving up energy cost. Also, the market is bullish on natural gas, do you agree.
Thank you in advance for taking the time to answer my question.
NL
5i Research Answer:
SGY is more oil, with 89% of production liquids. We think there is decent upside potential. The stock is very cheap, with a high dividend and a very strong balance sheet. It is less than 3X cash flow right now. We would also see it as a potential target at such low valuations. Nat gas has more than doubled from its low, and investors are starting to show more interest.