Texas Oil and Gas Co. Has Adjusted Production Estimates
Research Report

1. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

For additional disclosures, please click here.

Disclosures for Roth MKM, Evolution Petroleum Corp., August 29, 2024

Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.

Disclosures: ROTH makes a market in shares of Evolution Petroleum Corporation and as such, buys and sells from customers on a principal basis. Within the last twelve months, ROTH has received compensation for non-investment banking securities-related services from Evolution Petroleum Corporation.

ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months. The material, information and facts discussed in this report other than the information regarding ROTH Capital Partners, LLC and its affiliates, are from sources believed to be reliable, but are in no way guaranteed to be complete or accurate. This report should not be used as a complete analysis of the company, industry or security discussed in the report. Additional information is available upon request. This is not, however, an offer or solicitation of the securities discussed. Any opinions or estimates in this report are subject to change without notice. An investment in the stock may involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Additionally, an investment in the stock may involve a high degree of risk and may not be suitable for all investors. No part of this report may be reproduced in any form without the express written permission of ROTH. Copyright 2024. Member: FINRA/SIPC.

Roth MKM analyst John M. White, in a research report published on August 29, 2024, provided an update on Evolution Petroleum Corp. (EPM:NYSE) following the company's recent operational developments. The analyst maintained a Buy rating and a 12-month price target of US$8.25 on the stock.

White adjusted his production estimates for Evolution Petroleum's fourth fiscal quarter (F4Q) due to maintenance issues at the Delhi field.

"To be conservative, we are assuming this is pushed past June 2024, and thus lowering our production estimate for F4Q from 7,491 BOE per day to 7,275 BOE per day," the analyst noted.

The adjustment stems from preventative maintenance on the CO2 purchase pipeline at the Delhi field, which was taken offline at the end of February. While the operator anticipated resuming CO2 purchases in June 2024, White is taking a more conservative approach in his estimates.

As a result of the production adjustment, White revised his F4Q estimates: "Our new estimates for F4Q EPS/CFPS/EBITDA are US$0.02/US$0.20/US$7.9 million."

Evolution Petroleum's strategic focus includes acquisition, exploitation, and development of oil and gas properties, with a particular emphasis on applying primary, secondary, and tertiary recovery methods to further develop acquired properties.

The company recently completed a SCOOP/STACK acquisition and brought new Chaveroo wells online, which are expected to contribute to production in F4Q despite the Delhi field maintenance.

"Our valuation is based on a net asset value (NAV) analysis which produced US$8.23 per share which we adjusted higher to our US$8.25 per-share price target," White explained.

The analyst also highlighted Evolution Petroleum's attractive dividend yield: "EPM pays a common stock dividend of US$0.12 per share per quarter for an annual dividend of US$0.48, resulting in a dividend yield of 9.4% at the recent share price."

With a Buy rating and a price target of US$8.25, representing a potential return of approximately 60% from the price at the time of the report of US$5.16, Roth MKM sees upside potential for Evolution Petroleum. However, White notes several risk factors, including oil and natural gas price volatility, operational risks, regulatory changes, and petroleum reserve estimation uncertainties.