Sanchez Energy Is Lighting Up

 | Sep 09, 2013 | 1:08 PM EDT  | Comments
  • Comment
  • Print Print
  • Print
Stock quotes in this article:

sn

,

eog

,

hes

,

sto

,

xec

Opportunity is knocking with Sanchez Energy (SN). This little company, call it the son of EOG Resources (EOG), just filed 8 million shares so it could buy more assets in the Eagle Ford region, which has the most bountiful shale in this country.

Sanchez bought Hess's (HES) assets in Eagle Ford when Hess decided to focus on the Bakken Oil Formation. It bought those for $265 million in March. These new assets, the Wycross assets, are almost all oil. They, cost $220 million and they immediately boosted Sanchez's production a significant amount. This one is the one to watch. It shrewdly is not borrowing money, it's doing it all with equity.

In interviews, CEO Tony Sanchez has said he loved his overlooked status when they bought the Hess properties. No one is thinking about this $800 million company whose stock is up 32% this year. Big mistake. It has become a pure play on the Eagle Ford and it is a natural to be snapped up a year from now by a company such as Statoil (STO) or Cimarex (XEC) to boost assets. Sanchez may be the most exciting unheard play on this shale.

You have to get in on this deal. It will raise numbers further and allow more analyst coverage, which is meager right now.

Sanchez, the football player, may never get in again. Sanchez, the oil play, is a starter right now.

Columnist Conversations

It's been a strong month for oil so far, but as we come out of the holiday weekend, it is likely that we will ...
WMT's new domestic-store only, money transfer service looks to be a brilliant move. The retailer is undercutti...

BEST IDEAS

REAL MONEY'S BEST IDEAS

Columnist Tweets

BROKERAGE PARTNERS

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.


TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.