OKLAHOMA CITY - Gulfport Energy (OTC:GPORQ) Corporation (NYSE: GPOR) announced the pricing of its upsized $650 million private placement of 6.75% Senior Notes due 2029, to close on September 13, 2024. These notes, initially set at $500 million, will mature on September 1, 2029, and are guaranteed by Gulfport and its subsidiaries that back its credit facility and certain other debts.
Concurrently, Gulfport's subsidiary, Gulfport Operating, has launched a tender offer to buy back its 8.0% Senior Notes due 2026. The proceeds from the new offering are intended to fund this buyback, with any remaining funds earmarked for general corporate purposes, including debt repayment.
The new notes and guarantees are targeted at qualified institutional buyers and non-U.S. persons, in compliance with the Securities Act regulations. This offering has not been registered under the Securities Act or any state securities laws, and the securities may not be offered or sold in the U.S. without registration or an exemption.
This press release is based on a press release statement and does not constitute an offer to sell the securities described or a solicitation of an offer to buy the tender notes. The tender offer is outlined in the Offer to Purchase dated September 3, 2024.
Gulfport is an independent exploration and production company, primarily engaged in natural gas, crude oil, and NGL in the U.S., with a focus on the Appalachia and Anadarko basins. The company's forward-looking statements reflect plans for the offering and the tender offer but are subject to known and unknown risks, which could cause actual outcomes to differ materially.
In other recent news, Gulfport Energy Corporation has initiated a cash tender offer for all outstanding 8.0% Senior Notes due 2026. This is part of the company's debt management strategy, with the purchase price for the notes being determined based on a fixed spread plus the yield of the U.S. Treasury Reference Security. Gulfport Energy Operating Corporation, a subsidiary of the parent company, plans to offer $500 million of Senior Notes due 2029 to facilitate the repurchase of the existing 8.0% Senior Notes due 2026.
In addition to these developments, Gulfport Energy reported a robust $164 million in adjusted EBITDA and a substantial $20 million in adjusted free cash flow during its Second Quarter 2024 Earnings Call. The company also narrowed its full-year production guidance, with an average daily production of 1.05 billion cubic feet equivalent per day.
KeyBanc has raised Gulfport Energy's share price target to $165, citing the company's strong free cash flow generation and the potential for organic earnings growth. The analyst also increased the estimated 2025 EBITDA by 3% to $891 million and the forecast for the company's 2025 repurchase program by 60% to $160 million. These recent developments reflect Gulfport Energy's strategic financial management and commitment to shareholder returns.
InvestingPro Insights
Gulfport Energy Corporation's (NYSE: GPOR) recent financial activities, including the pricing of its upsized $650 million private placement and its subsidiary's tender offer, are strategic moves in the company's financial management. As investors consider Gulfport's latest financial endeavors, it is essential to note the company's current financial health and market performance based on recent InvestingPro data and tips.
With a market capitalization of $2.54 billion and a notably low price-to-earnings (P/E) ratio of 3.41, Gulfport presents itself as a potentially undervalued investment opportunity. The P/E ratio, which slightly adjusted to 3.32 for the last twelve months as of Q2 2024, suggests that the stock could be trading at a discount relative to its earnings.
InvestingPro Tips highlight that while Gulfport has been profitable over the last twelve months, analysts are predicting a sales decline in the current year and anticipate that net income may also drop. This outlook is reflected in the company's revenue growth, which saw a significant decrease of 48.3% over the last twelve months as of Q2 2024. Despite this, the company's gross profit margin remains strong at 56.26%, indicating that Gulfport maintains the ability to generate a healthy profit from its revenues.
Investors should also be aware that Gulfport does not pay dividends, which might influence the investment decisions for those seeking regular income. Nevertheless, the company's stock has experienced a 17.51% price total return over the past year, demonstrating resilience and potential for capital appreciation.
For those considering an investment in Gulfport, there are additional InvestingPro Tips available that could further inform their decision. The platform offers a total of 8 tips for Gulfport, providing a more comprehensive understanding of the company's financial standing and future outlook.
Overall, Gulfport's financial maneuvers and market performance present a mixed picture, with strong profitability indicators tempered by analysts' concerns over future earnings and sales. As the company continues to navigate the challenges of the energy sector, these InvestingPro Insights can serve as a valuable resource for investors.
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