Morningstar | Nudging Concho Resources' Fair Value Estimate to $107 After Sale of Oryx Equity Investment. See Updated Analyst Note from 02 Apr 2019
On April 2 Concho announced that it will receive approximately $300 million in proceeds following the acquisition of Oryx Southern Delaware Holdings (as Concho holds a 23.75% stake in Oryx). Oryx operates one of the five crude oil gathering systems that Concho uses to connect its production with regional pipelines in the Delaware Basin, and we expect no change in the firm's ability to access this system as a result of this transaction. The company had invested approximately $45 million in Oryx since 2015 and received a distribution of $157 million in 2018. Another distribution of $157 million, paid in February 2019, was announced along with the divestiture. That pegs the total asset value at $457 million ($2.29 per share), which we previously modeled no credit for in our model. The sale of the asset will not impact reported unit costs for Concho as it was treated as an equity investment and therefore not consolidated. Accordingly, we are raising our fair value estimate to $107.Concho Resources is an independent oil and natural gas company engaged in the acquisition, development, exploration and production of oil and natural gas properties. The company's operations are primarily focused in the Permian Basin of West Texas and Southeast New Mexico.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
We have operations in 27 countries.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.