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Recommendation: Buy. Cabot Oil & Gas. Duc Dam Sarah Dhaduk Maria Tabanian Nga Tran. Overview. Recommendation: Buy Target price: $78.00 Current price: $43.15 (10/25/2012) Investment Thesis Stable revenue Good financial position Potential development. Contents. Business outlook

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Recommendation buy

Recommendation: Buy

Cabot Oil & Gas

Duc Dam

Sarah Dhaduk

Maria Tabanian

Nga Tran


Overview
Overview

Recommendation: Buy

  • Target price: $78.00

  • Current price: $43.15(10/25/2012)

    Investment Thesis

  • Stable revenue

  • Good financial position

  • Potential development


Contents
Contents

  • Business outlook

  • Good financial position

  • Stable revenues

  • Potential growth


Contents1
Contents

  • Business outlook


Outlook
Outlook

  • Cabot Oil & Gas Corporation is an independent oil and gas company engaged in the development, exploitation and exploration of oil and gas properties.

  • The Company’s primary areas of operation include Appalachia, east and south Texas, and Oklahoma.

    (Rueters)


Primary and secondary markets products foreign and domestic
Primary and Secondary Markets/Products (Foreign and Domestic)

  • The Company operates in one division, natural gas and oil development, exploitation and exploration, exclusively in the continental United States.

  • Cabot Oil & Gas Company is only a domestic company and does not have any foreign affiliations. Approximately 96% of Cabot’s reserves and 95% of Cabot’s production is natural gas, that being its primary market. Cabot’s secondary market is petroleum.

    (Rueters)


Business risks outstanding litigations
Business risks/outstanding litigations Domestic)

  • Toxic hydro-fracking spills

  • Pennsylvania Department of Environmental Protection


Contents2
Contents Domestic)

  • Business outlook

  • Good financial position



4 year
4 Year Domestic)


Contents3
Contents Domestic)

  • Business outlook

  • Good financial position

  • Stable revenues


Business strategy
Business Strategy Domestic)

  • COG strategy is to continuously improve.


Long term solvency
Long – term Solvency Domestic)

Annual Comparision for Debt to Capital Ratio


Long term solvency1
Long – term Solvency Domestic)

Annual Comparision for Debt to Equity Ratio


Low financial risk
Low Financial Risk Domestic)

Annual Comparision for TL/TA ratio


Stable operating cashflow
Stable Operating Cashflow Domestic)

Annual Cashflow break - down


Potential operating cashflow growth
Potential Operating Domestic)Cashflow Growth

Compound Annual Growth Rate over 5 years


Contents4
Contents Domestic)

  • Business outlook

  • Good financial position

  • Stable revenues

  • Potential growth


SWOT Domestic)

  • Strength

  • Marcellus Shale

  • Constant Growth

  • Weakness

  • Toxin during exploitation

  • Opportunities

  • Future natural gas’ price

  • Threats

  • Warmer winter

  • Economic downturn


Revenue drivers
Revenue Drivers Domestic)


Gross margin
Gross Margin Domestic)


Valuation
Valuation Domestic)


Sources used
Sources Used Domestic)

Cabot oil & gas corporation (cog.n). Reuters. Retrieved from http://www.reuters.com/finance/stocks/companyProfile?symbol=COG.N

www.capitaliq.com

Daris, M. (2012, October 4). 3 new reasons to buy cabot now. Seeking Alpha, Retrieved from http://seekingalpha.com/article/903581-3-new-reasons-to-buy-cabot-now?source=yahoo

McFarland, J. (2012, October 2). [Web log message]. Retrieved from http://www.oilandgaslawyerblog.com/oil-and-gas-news/

Operator: Cabot oil and gas corporation. (n.d.). Retrieved from http://www.fracktrack.org/searchexp.php?p=op_name&val=OGO-10897


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