SandRidge Energy: New Exploration Opportunities

Wunderlich reports that "[we] are impressed with the exploration results from SandRidge Energy SD and the latest Sahara play in Northwest Oklahoma is no exception. The company has drilled 19 wells and partnered on 40 wells in the new oil play. In addition, we believe investor cash concerns are overdone as asset sales should generate $400 million and next year's cash flow could generate over $500 million. Though we are not banking on a natural gas rebound next year, any upward movement would be a big beneficiary. We believe the stock is too cheap especially given the oil leverage. As such, we reiterate our Buy rating and $10.00 price target based on our 2011 CFPS estimate of $1.25 and 8.0x peer group multiple." Wunderlich maintains its Buy rating and $10 price target. SandRidge Energy, Inc. closed yesterday at $4.58. Click here to get today's best trading ideas.
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