Goodrich Petroleum received a nice endorsement regarding the Tuscaloosa Marine Shale yesterday.
"Goodrich Petroleum (NYSE: GDP) is seeing sharp upside Monday, which is being
attributed to takeover speculation sparked by analysts. Canaccord Genuity analyst John
Gerdes said the 'stock could triple' with success at its Tuscaloosa Marine Shale
play. 'Goodrich closed Friday with a
market capitalization of ~$500 million. With follow-on drilling success, we
believe Goodrich should be able to sell a 25% interest in its ~103,000 net acre
Tuscaloosa leasehold for $5,000 per acre, or ~$125 million,' Gerdes said.
'Additionally, Goodrich would likely raise $100-150 million in equity to fund
the ~$175 million increase in capital spending. Under this scenario, our target
price would likely increase ~50% to ~$40/share.' The Tuscaloosa play may be too large for Goodrich to develop
alone and 'a larger entity could buy Goodrich in its entirety or the company
could enter into a joint venture and issue equity to fund Tuscaloosa
development,' the analyst also said."