Intrinsic value of Gulfport Energy - GPOR

Previous Close

$11.86

  Intrinsic Value

$4.31

stock screener

  Rating & Target

str. sell

-64%

Previous close

$11.86

 
Intrinsic value

$4.31

 
Up/down potential

-64%

 
Rating

str. sell

We calculate the intrinsic value of GPOR stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2017), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 2.1

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  2,112
  3,263
  4,880
  7,080
  9,989
  13,733
  18,434
  24,205
  31,146
  39,340
  48,851
  59,725
  71,989
  85,653
  100,713
  117,153
  134,950
  154,076
  174,499
  196,189
  219,117
  243,260
  268,598
  295,121
  322,825
  351,712
  381,796
  413,097
  445,643
  479,469
Variable operating expenses, $m
  6,864
  10,605
  15,860
  23,011
  32,466
  44,633
  59,911
  78,666
  101,225
  127,855
  158,767
  194,108
  233,965
  278,372
  327,316
  380,747
  438,589
  500,748
  567,123
  637,615
  712,131
  790,594
  872,944
  959,144
  1,049,180
  1,143,065
  1,240,838
  1,342,565
  1,448,338
  1,558,275
Fixed operating expenses, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  6,864
  10,605
  15,860
  23,011
  32,466
  44,633
  59,911
  78,666
  101,225
  127,855
  158,767
  194,108
  233,965
  278,372
  327,316
  380,747
  438,589
  500,748
  567,123
  637,615
  712,131
  790,594
  872,944
  959,144
  1,049,180
  1,143,065
  1,240,838
  1,342,565
  1,448,338
  1,558,275
Operating income, $m
  -4,752
  -7,342
  -10,980
  -15,931
  -22,476
  -30,900
  -41,477
  -54,461
  -70,079
  -88,515
  -109,916
  -134,382
  -161,976
  -192,719
  -226,604
  -263,594
  -303,639
  -346,672
  -392,624
  -441,426
  -493,014
  -547,334
  -604,346
  -664,023
  -726,355
  -791,353
  -859,042
  -929,468
  -1,002,696
  -1,078,806
EBITDA, $m
  -4,156
  -6,421
  -9,602
  -13,932
  -19,656
  -27,023
  -36,273
  -47,628
  -61,286
  -77,409
  -96,125
  -117,522
  -141,653
  -168,539
  -198,172
  -230,522
  -265,542
  -303,176
  -343,362
  -386,041
  -431,157
  -478,662
  -528,521
  -580,710
  -635,222
  -692,064
  -751,261
  -812,851
  -876,891
  -943,452
Interest expense (income), $m
  69
  118
  211
  346
  535
  793
  1,133
  1,571
  2,121
  2,796
  3,609
  4,567
  5,680
  6,953
  8,388
  9,987
  11,749
  13,672
  15,755
  17,993
  20,383
  22,921
  25,604
  28,429
  31,394
  34,497
  37,739
  41,119
  44,639
  48,302
  52,110
Earnings before tax, $m
  -4,870
  -7,553
  -11,326
  -16,466
  -23,269
  -32,033
  -43,048
  -56,582
  -72,875
  -92,123
  -114,483
  -140,063
  -168,928
  -201,107
  -236,590
  -275,343
  -317,311
  -362,427
  -410,617
  -461,808
  -515,934
  -572,938
  -632,774
  -695,416
  -760,853
  -829,092
  -900,161
  -974,108
  -1,050,997
  -1,130,916
Tax expense, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -4,870
  -7,553
  -11,326
  -16,466
  -23,269
  -32,033
  -43,048
  -56,582
  -72,875
  -92,123
  -114,483
  -140,063
  -168,928
  -201,107
  -236,590
  -275,343
  -317,311
  -362,427
  -410,617
  -461,808
  -515,934
  -572,938
  -632,774
  -695,416
  -760,853
  -829,092
  -900,161
  -974,108
  -1,050,997
  -1,130,916

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  9,304
  14,375
  21,497
  31,191
  44,007
  60,499
  81,207
  106,630
  137,207
  173,304
  215,204
  263,108
  317,133
  377,326
  443,668
  516,093
  594,496
  678,750
  768,720
  864,269
  965,274
  1,071,628
  1,183,252
  1,300,093
  1,422,135
  1,549,394
  1,681,923
  1,819,811
  1,963,183
  2,112,200
Adjusted assets (=assets-cash), $m
  9,304
  14,375
  21,497
  31,191
  44,007
  60,499
  81,207
  106,630
  137,207
  173,304
  215,204
  263,108
  317,133
  377,326
  443,668
  516,093
  594,496
  678,750
  768,720
  864,269
  965,274
  1,071,628
  1,183,252
  1,300,093
  1,422,135
  1,549,394
  1,681,923
  1,819,811
  1,963,183
  2,112,200
Revenue / Adjusted assets
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
  0.227
Average production assets, $m
  5,962
  9,212
  13,776
  19,988
  28,200
  38,769
  52,039
  68,331
  87,925
  111,057
  137,907
  168,605
  203,226
  241,798
  284,312
  330,723
  380,965
  434,957
  492,612
  553,842
  618,568
  686,722
  758,253
  833,127
  911,334
  992,884
  1,077,811
  1,166,173
  1,258,049
  1,353,542
Working capital, $m
  -872
  -1,348
  -2,015
  -2,924
  -4,126
  -5,672
  -7,613
  -9,997
  -12,863
  -16,247
  -20,176
  -24,667
  -29,732
  -35,375
  -41,594
  -48,384
  -55,735
  -63,634
  -72,068
  -81,026
  -90,495
  -100,466
  -110,931
  -121,885
  -133,327
  -145,257
  -157,682
  -170,609
  -184,050
  -198,021
Total debt, $m
  3,704
  6,067
  9,386
  13,904
  19,876
  27,561
  37,211
  49,058
  63,307
  80,128
  99,654
  121,977
  147,153
  175,203
  206,118
  239,868
  276,404
  315,666
  357,592
  402,118
  449,186
  498,747
  550,764
  605,212
  662,084
  721,386
  783,145
  847,400
  914,212
  983,654
Total liabilities, $m
  4,336
  6,699
  10,018
  14,535
  20,507
  28,193
  37,843
  49,690
  63,939
  80,760
  100,285
  122,608
  147,784
  175,834
  206,749
  240,499
  277,035
  316,298
  358,223
  402,749
  449,818
  499,379
  551,395
  605,843
  662,715
  722,018
  783,776
  848,032
  914,843
  984,285
Total equity, $m
  4,968
  7,676
  11,480
  16,656
  23,500
  32,306
  43,365
  56,941
  73,269
  92,544
  114,919
  140,499
  169,349
  201,492
  236,919
  275,594
  317,461
  362,453
  410,496
  461,520
  515,456
  572,249
  631,856
  694,250
  759,420
  827,376
  898,147
  971,779
  1,048,340
  1,127,915
Total liabilities and equity, $m
  9,304
  14,375
  21,498
  31,191
  44,007
  60,499
  81,208
  106,631
  137,208
  173,304
  215,204
  263,107
  317,133
  377,326
  443,668
  516,093
  594,496
  678,751
  768,719
  864,269
  965,274
  1,071,628
  1,183,251
  1,300,093
  1,422,135
  1,549,394
  1,681,923
  1,819,811
  1,963,183
  2,112,200
Debt-to-equity ratio
  0.750
  0.790
  0.820
  0.830
  0.850
  0.850
  0.860
  0.860
  0.860
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
  0.870
Adjusted equity ratio
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534
  0.534

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -4,870
  -7,553
  -11,326
  -16,466
  -23,269
  -32,033
  -43,048
  -56,582
  -72,875
  -92,123
  -114,483
  -140,063
  -168,928
  -201,107
  -236,590
  -275,343
  -317,311
  -362,427
  -410,617
  -461,808
  -515,934
  -572,938
  -632,774
  -695,416
  -760,853
  -829,092
  -900,161
  -974,108
  -1,050,997
  -1,130,916
Depreciation, amort., depletion, $m
  596
  921
  1,378
  1,999
  2,820
  3,877
  5,204
  6,833
  8,793
  11,106
  13,791
  16,860
  20,323
  24,180
  28,431
  33,072
  38,097
  43,496
  49,261
  55,384
  61,857
  68,672
  75,825
  83,313
  91,133
  99,288
  107,781
  116,617
  125,805
  135,354
Funds from operations, $m
  -4,274
  -6,632
  -9,948
  -14,467
  -20,449
  -28,156
  -37,844
  -49,749
  -64,082
  -81,018
  -100,692
  -123,202
  -148,606
  -176,927
  -208,159
  -242,271
  -279,215
  -318,931
  -361,355
  -406,424
  -454,078
  -504,266
  -556,949
  -612,103
  -669,719
  -729,803
  -792,380
  -857,490
  -925,193
  -995,562
Change in working capital, $m
  -327
  -475
  -668
  -909
  -1,201
  -1,546
  -1,941
  -2,383
  -2,867
  -3,384
  -3,928
  -4,491
  -5,065
  -5,643
  -6,220
  -6,790
  -7,350
  -7,899
  -8,435
  -8,958
  -9,469
  -9,971
  -10,465
  -10,954
  -11,442
  -11,931
  -12,425
  -12,927
  -13,441
  -13,970
Cash from operations, $m
  -3,947
  -6,156
  -9,280
  -13,558
  -19,247
  -26,610
  -35,902
  -47,366
  -61,216
  -77,634
  -96,764
  -118,711
  -143,541
  -171,284
  -201,939
  -235,481
  -271,864
  -311,032
  -352,921
  -397,466
  -444,608
  -494,295
  -546,484
  -601,149
  -658,278
  -717,873
  -779,955
  -844,563
  -911,751
  -981,591
Maintenance CAPEX, $m
  -373
  -596
  -921
  -1,378
  -1,999
  -2,820
  -3,877
  -5,204
  -6,833
  -8,793
  -11,106
  -13,791
  -16,860
  -20,323
  -24,180
  -28,431
  -33,072
  -38,097
  -43,496
  -49,261
  -55,384
  -61,857
  -68,672
  -75,825
  -83,313
  -91,133
  -99,288
  -107,781
  -116,617
  -125,805
New CAPEX, $m
  -2,236
  -3,249
  -4,564
  -6,212
  -8,212
  -10,569
  -13,270
  -16,292
  -19,594
  -23,131
  -26,851
  -30,698
  -34,621
  -38,573
  -42,514
  -46,411
  -50,242
  -53,992
  -57,654
  -61,230
  -64,726
  -68,154
  -71,531
  -74,875
  -78,207
  -81,550
  -84,927
  -88,362
  -91,876
  -95,493
Cash from investing activities, $m
  -2,609
  -3,845
  -5,485
  -7,590
  -10,211
  -13,389
  -17,147
  -21,496
  -26,427
  -31,924
  -37,957
  -44,489
  -51,481
  -58,896
  -66,694
  -74,842
  -83,314
  -92,089
  -101,150
  -110,491
  -120,110
  -130,011
  -140,203
  -150,700
  -161,520
  -172,683
  -184,215
  -196,143
  -208,493
  -221,298
Free cash flow, $m
  -6,555
  -10,002
  -14,766
  -21,148
  -29,458
  -39,998
  -53,049
  -68,861
  -87,643
  -109,558
  -134,720
  -163,199
  -195,022
  -230,179
  -268,633
  -310,323
  -355,179
  -403,121
  -454,071
  -507,958
  -564,718
  -624,306
  -686,687
  -751,849
  -819,797
  -890,556
  -964,171
  -1,040,706
  -1,120,245
  -1,202,889
Issuance/(repayment) of debt, $m
  1,630
  2,363
  3,319
  4,517
  5,972
  7,685
  9,650
  11,847
  14,249
  16,821
  19,526
  22,323
  25,176
  28,050
  30,916
  33,750
  36,536
  39,263
  41,926
  44,526
  47,068
  49,561
  52,016
  54,448
  56,871
  59,303
  61,758
  64,256
  66,811
  69,442
Issuance/(repurchase) of shares, $m
  6,737
  10,261
  15,129
  21,643
  30,112
  40,840
  54,106
  70,158
  89,203
  111,399
  136,858
  165,643
  197,778
  233,250
  272,017
  314,018
  359,178
  407,419
  458,660
  512,832
  569,871
  629,731
  692,381
  757,810
  826,023
  897,048
  970,931
  1,047,740
  1,127,558
  1,210,491
Cash from financing (excl. dividends), $m  
  8,367
  12,624
  18,448
  26,160
  36,084
  48,525
  63,756
  82,005
  103,452
  128,220
  156,384
  187,966
  222,954
  261,300
  302,933
  347,768
  395,714
  446,682
  500,586
  557,358
  616,939
  679,292
  744,397
  812,258
  882,894
  956,351
  1,032,689
  1,111,996
  1,194,369
  1,279,933
Total cash flow (excl. dividends), $m
  1,811
  2,622
  3,682
  5,012
  6,626
  8,527
  10,706
  13,144
  15,809
  18,662
  21,663
  24,767
  27,932
  31,120
  34,300
  37,444
  40,535
  43,561
  46,515
  49,400
  52,221
  54,986
  57,711
  60,408
  63,097
  65,794
  68,519
  71,290
  74,125
  77,043
Retained Cash Flow (-), $m
  -6,737
  -10,261
  -15,129
  -21,643
  -30,112
  -40,840
  -54,106
  -70,158
  -89,203
  -111,399
  -136,858
  -165,643
  -197,778
  -233,250
  -272,017
  -314,018
  -359,178
  -407,419
  -458,660
  -512,832
  -569,871
  -629,731
  -692,381
  -757,810
  -826,023
  -897,048
  -970,931
  -1,047,740
  -1,127,558
  -1,210,491
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  7
  11
  16
  24
  35
  50
  69
  92
  121
  156
  197
  244
  299
  360
  428
  504
  586
  675
  770
  872
  981
  1,096
  1,216
  1,343
  1,476
  1,614
  1,759
  1,909
  2,065
  2,228
Cash available for distribution, $m
  -4,925
  -7,639
  -11,447
  -16,631
  -23,487
  -32,313
  -43,399
  -57,014
  -73,394
  -92,737
  -115,195
  -140,876
  -169,846
  -202,129
  -237,717
  -276,573
  -318,643
  -363,858
  -412,145
  -463,431
  -517,650
  -574,745
  -634,671
  -697,401
  -762,926
  -831,254
  -902,412
  -976,450
  -1,053,433
  -1,133,448
Discount rate, %
  4.90
  5.15
  5.40
  5.67
  5.96
  6.25
  6.57
  6.89
  7.24
  7.60
  7.98
  8.38
  8.80
  9.24
  9.70
  10.19
  10.70
  11.23
  11.79
  12.38
  13.00
  13.65
  14.33
  15.05
  15.80
  16.59
  17.42
  18.29
  19.21
  20.17
PV of cash for distribution, $m
  -4,695
  -6,910
  -9,775
  -13,337
  -17,587
  -22,455
  -27,806
  -33,445
  -39,126
  -44,573
  -49,498
  -53,631
  -56,741
  -58,655
  -59,274
  -58,579
  -56,631
  -53,564
  -49,569
  -44,879
  -39,746
  -34,423
  -29,143
  -24,108
  -19,475
  -15,354
  -11,806
  -8,845
  -6,452
  -4,577
Current shareholders' claim on cash, %
  24.4
  6.2
  1.6
  0.4
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Gulfport Energy Corporation is an oil and natural gas exploration and production company. The Company focuses on the exploitation and acquisition of natural gas, natural gas liquids and crude oil in the United States. The Company's properties are located in the Utica Shale in Eastern Ohio and along the Louisiana Gulf Coast in the West Cote Blanche Bay (WCBB) and Hackberry fields. The Company also has an interest in producing properties in Northwestern Colorado in the Niobrara Formation and in Western North Dakota in the Bakken Formation. The Company also holds an acreage position in the Alberta oil sands in Canada through its interest in Grizzly Oil Sands ULC and an interest in an entity that operates in the Phu Horm gas field in Thailand. The Company also owns interests in various fields, which includes Deer Island, Fay South, Crest, Squaw Cheek, Green River Basin and Watonga Chickasha Trend.

FINANCIAL RATIOS  of  Gulfport Energy (GPOR)

Valuation Ratios
P/E Ratio -1.9
Price to Sales 4.9
Price to Book 0.9
Price to Tangible Book
Price to Cash Flow 5.6
Price to Free Cash Flow -4.5
Growth Rates
Sales Growth Rate -45.6%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -52.4%
Cap. Spend. - 3 Yr. Gr. Rate -1.3%
Financial Strength
Quick Ratio NaN
Current Ratio 0.5
LT Debt to Equity 73%
Total Debt to Equity 73%
Interest Coverage -13
Management Effectiveness
Return On Assets -24.1%
Ret/ On Assets - 3 Yr. Avg. -16.5%
Return On Total Capital -29%
Ret/ On T. Cap. - 3 Yr. Avg. -20.2%
Return On Equity -46.4%
Return On Equity - 3 Yr. Avg. -30.5%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 78.8%
Gross Margin - 3 Yr. Avg. 85.2%
EBITDA Margin -173.1%
EBITDA Margin - 3 Yr. Avg. -74.1%
Operating Margin -231.1%
Oper. Margin - 3 Yr. Avg. -129.9%
Pre-Tax Margin -254.7%
Pre-Tax Margin - 3 Yr. Avg. -134.6%
Net Profit Margin -253.9%
Net Profit Margin - 3 Yr. Avg. -130%
Effective Tax Rate 0.3%
Eff/ Tax Rate - 3 Yr. Avg. 18.7%
Payout Ratio 0%

GPOR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the GPOR stock intrinsic value calculation we used $1320 million for the last fiscal year's total revenue generated by Gulfport Energy. The default revenue input number comes from 2017 income statement of Gulfport Energy. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our GPOR stock valuation model: a) initial revenue growth rate of 60% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.9%, whose default value for GPOR is calculated based on our internal credit rating of Gulfport Energy, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Gulfport Energy.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of GPOR stock the variable cost ratio is equal to 325%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for GPOR stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.7% for Gulfport Energy.

Corporate tax rate of 27% is the nominal tax rate for Gulfport Energy. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the GPOR stock is equal to 0.5%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for GPOR are equal to 282.3%.

Life of production assets of 10 years is the average useful life of capital assets used in Gulfport Energy operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for GPOR is equal to -41.3%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $3102 million for Gulfport Energy - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 180 million for Gulfport Energy is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Gulfport Energy at the current share price and the inputted number of shares is $2.1 billion.

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COMPANY NEWS

▶ Gulfport Energy Corporation Provides Operational Update   [Jun-19-18 07:00AM  GlobeNewswire]
▶ The Most Intriguing Value Stocks On The Nasdaq   [Jun-09-18 10:23AM  Forbes]
▶ Gulfport Energy Corporation Provides SCOOP Well Results   [May-15-18 08:00AM  GlobeNewswire]
▶ Gulfport Energy: 1Q Earnings Snapshot   [May-08-18 04:07PM  Associated Press]
▶ EQT Midstream acquiring midstream assets worth more than $1.5B   [Apr-26-18 07:53AM  American City Business Journals]
▶ Gulfport Energy Corporation Provides SCOOP Well Results   [Mar-26-18 07:30AM  GlobeNewswire]
▶ Gulfport Energy beats Street 4Q forecasts   [Feb-21-18 05:01PM  Associated Press]
▶ 9 Best Energy Stocks To Own Before Earnings   [Feb-01-18 10:13AM  Benzinga]
▶ Inventory Data: Natural GasWeighted Stocks Could Rise   [Jan-25-18 02:30PM  Market Realist]
▶ Natural Gas Longs: Heres Why You Should Watch Oil Rigs   [Jan-17-18 02:29PM  Market Realist]
▶ Wall Street and US Natural Gas Futures Could Diverge   [Jan-08-18 08:12AM  Market Realist]
▶ Is Natural Gas Rising Less Than Natural GasWeighted Stocks?   [Dec-28-17 10:55AM  Market Realist]
▶ Is Gulfport Energys Normalized Free Cash Flow Trending Up?   [Dec-22-17 10:32AM  Market Realist]
▶ These 5 Energy Stocks Could Be Huge Winners in 2018   [Dec-20-17 07:34PM  Motley Fool]
▶ EIA Upgrades US Natural Gas Production for 2018   [Dec-15-17 11:00AM  Market Realist]
▶ Natural Gas Bears Will Not Be Deterred   [Dec-14-17 05:35PM  Barrons.com]
▶ Is US Natural Gas Production Helping Natural Gas Bears?   [Dec-08-17 10:06AM  Market Realist]
▶ Which Gas-Weighted Stocks Could Be in Trouble If Oil Falls?   [Dec-05-17 11:33AM  Market Realist]
▶ US Crude Oil Production: Will Crude Oil Futures Collapse?   [Nov-30-17 10:55AM  Market Realist]
▶ Which Gas-Weighted Stocks Are Outperforming Natural Gas?   [Nov-21-17 09:44AM  Market Realist]
▶ US Crude Oil Inventories: Bearish Driver for Crude Oil   [Nov-16-17 08:52AM  Market Realist]
▶ Hedge Funds: Bullish or Bearish on Natural Gas?   [Nov-13-17 07:32AM  Market Realist]
▶ How Oil Prices Could Spoil the Rise in Natural Gas   [Nov-09-17 10:45AM  Market Realist]
▶ Natural Gass Surge in November 2017   [10:32AM  Market Realist]
▶ US Natural Gas Consumption Could Surpass Production   [Nov-06-17 08:45AM  Market Realist]
▶ Are Natural Gas Prices Underperforming Crude Oil?   [Nov-02-17 03:52PM  Market Realist]
▶ Gulfport Energy misses Street 3Q forecasts   [Nov-01-17 05:28PM  Associated Press]
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