Crescent Energy Co (NYSE:CRGY) disclosed in a recent SEC filing that it expects to report $25 million in net cash settlements paid on its hedge positions for the second quarter of 2024, and $48 million for the first half of the year. The Houston-based crude petroleum and natural gas company, which operates under the SIC code 1311, stated that these figures are preliminary and could be subject to change.
The company, formerly known as IE PubCo Inc., emphasized that the reported dollar amounts are forward-looking statements and are contingent on various assumptions, risks, and uncertainties, implying that actual results could differ from current expectations. Crescent Energy plans to provide final figures in its upcoming Quarterly Report on Form 10-Q for the period ended June 30, 2024.
Additionally, the filing mentioned a proposed business combination transaction between Crescent and SilverBow Resources (NYSE:SBOW), Inc. (“SilverBow”), detailing that a joint proxy statement/prospectus was mailed to the stockholders of both companies on June 28, 2024. The transaction is subject to approval from both sets of shareholders.
In other recent news, Crescent Energy Company and SilverBow Resources are moving closer to finalizing their merger. The expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 signals a significant step toward the completion of the acquisition. Shareholders of both companies are scheduled to vote on the proposed transaction, which, if approved, is expected to create a leading mid-cap exploration and production company with high-quality assets in the Eagle Ford (NYSE:F) region.
Analysts from KeyBanc Capital Markets, Raymond James, and Truist Securities have responded positively to the merger, upgrading their stock targets for Crescent Energy. KeyBanc has given Crescent an Overweight rating and set a price target of $16.00, while Raymond James and Truist Securities have raised their stock targets, citing the potential to boost the company's free cash flow and other essential metrics.
In financial news, Crescent Energy has announced plans to issue $750 million in senior notes to fund the merger with SilverBow Resources. The company also demonstrated a strong financial performance in the first quarter of 2024, exceeding market expectations with higher-than-anticipated EBITDA and free cash flow, and subsequently raising its full-year production outlook. These recent developments highlight Crescent Energy's strategic growth and financial strength.
InvestingPro Insights
As Crescent Energy Co (NYSE:CRGY) navigates through its hedge positions and a potential merger with SilverBow Resources, investors might consider several key financial metrics and analyst insights. According to InvestingPro data, Crescent Energy currently holds a market capitalization of $2.16 billion USD. While the company has faced a revenue decline of 19.63% over the last twelve months as of Q1 2024, it managed to secure a quarterly revenue growth of 11.41% in Q1 2024, indicating a potential rebound. The gross profit margin stands strong at 54.67%, reflecting the company's effectiveness in maintaining profitability despite revenue fluctuations.
InvestingPro Tips highlight that analysts predict Crescent Energy will become profitable this year, which may reassure investors concerned about the company's past performance, where it was not profitable over the last twelve months. However, caution is advised as the company is quickly burning through cash and its short-term obligations exceed its liquid assets, which could pose liquidity risks. For those looking to delve deeper into Crescent Energy's financial health, InvestingPro offers additional insights and tips, with a total of 5 additional InvestingPro Tips available for Crescent Energy at: https://www.investing.com/pro/CRGY. To access these valuable insights, use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.