Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
The stock fell on the Q2 earnings call. Why? I see three reasons: 1)missing analyst estimates for revenue; ie, $280.6M actual v $329.3M estimated and 2) raising FY capex 23% to $1.35B "without a corresponding increase in production outlook", and 3) cost outlook increasing from $2.68 to $2.80 - $3.00 per mcf

Selling is way overdone. Versus a year ago, that $280.6M revenue is up 23% and net profit is up $0.40 per share.

A Motley Fool article on July 25 cited three reasons why UPL is well positioned: 1) all-in cost of $2.68/mcf less than half the industry "mean of $5.62/mcf, 2) UPL incresed reserves over the last 5 years at a 17% annualized rate, and 3) management expects +50% production growth in the next 3 years.

The negatives on all-in cost and missing the revenue estimate are not large enough to warrant this stock trading down.

The increase in capex and the bid on the Colorado shale are items I need to do more research on.

Pending that I may lose some of my nervousness and add to my UPL holding.
Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement