Cimarex Energy Co. (NYSE:XEC)

this company is showing great rate of production of oil

undervalued

Formed in February 2002, Cimarex Energy operates as an oil and gas exploration and production company. Its operations are mainly located in Texas, Oklahoma, New Mexico, Louisiana and the Gulf of Mexico. Proved oil and gas reserves as of year-end 2006 totaled nearly 1.45 tcfe, consisting of 1.1 tcf of gas and 59.8 million barrels of oil and natural gas liquids.

The financial health of the company primarily depends on the prices of gas and oil as gas and oil exploration revenues currently account for about 64% and 32% respectively. Despite, the peak in the oil prices in the mid of 2006, Cimarex’ topline tumbled in the third quarter of 2006 due to the weakness in the natural gas prices. Moving ahead, the price trend again worked against the company’s favour as natural gas prices declined by over 41% along with cooling oil prices resulting in over 31% drop in the fourth quarter’s total turnover. Its bottom-line has also collapsed by 65% in the fourth quarter owing to the galloping drilling and production costs. In 2007, Energy Information Administration (EIA) estimates average rate for natural gas and oil to plunge as compared to the previous year which means rough weather for Cimarex Energy.

Technical faults in company’s three major well namely Harrington, Galloway and Laguna deep has cost heavily for the company affecting daily natural gas production of about 26 million cubic feet. Management hopes to recover from this crisis by the end of 2007 and thereby expects flattish production growth for fiscal 2007. Looking ahead, the ‘Plaquemines Parish’ project could prove to be a gold mine for Cimarex. However, it is a high-risk project with an estimated failure of 75%. Given these factors, Cimarex energy could face difficulties in climbing the growth ladder in the near future.

cheap oil and Gas . consistent performer

Incredible profits.

Came up on one of my P/B value stock screens (P/B

Oil and gas supplies will shrink as the winter progresses

Great play on Natural Gas and Energy

Cheaply valued versus peers. US energy oil and gas exploration company

Solid company.

Current valuation is low compared to industry. Earnings dependent on natural gas prices which will most likely go back up in the next year.

Jim Cramer spoke to the masses - and the masses moved. I'm not the masses, and am not affected by Cramer's hypotic / magical words. The company did not meet quarterly guidance. So what? Show me the buffoon that makes investment decisions on missing quarterly guidance?

This company has OK fundamentals - could be better, but can't resist going against the crowd and Jim - he's offering a 'cigar-butt' opportunity.

EPS persistence: 0.17, 1.31, 2.18, 3.59 and 4.90
ROE: 17%

Under valued domestic energy explorer/producer should benefit from Iraq escalating into regional Sunni/Shia Persian/Arab conflict after American pull-back, or any number of other ME scenarios.

High quality U.S. NG producer, (spun off from another top notch petroleum operator, Helmerich & Payne), with smart, conservative management. Cimarex has been very efficient in developing replacement wells, with just under 90% drilling success the past two years. Its replacement rate has been substantially more than 150% of production.

XEC is cheap relative to peers, with a P/E below 10, an undeserved discount to peers. Its shares sell at just above book value, at a P/B of 1.1. I believe this stock is a bargain at $35-36, and will nicely reward Patient Fools.

"What's in your wallet?" ... Cimarex Energy is a long-term hold in my real $ portfolio.

bargain gas driller..

low gas prices and dropping oil prices are going to hurt them. They also have experienced fast growth this could cause problems in the long run if prices stay down.

Energy and oil are at their usual Fall season lows and Cimarex is no exception. Right at its 52 week low with a P/E of 6.59?? I'm liking my chops on this bargain. Morningstar gives it a 5 star rating and fair value estimate of $59.00. Standard & Poor give it 5 stars also.

Natural gas is hitting a bottom and XEC is trading at book value. Lots o cash being genereated in an adverse market.