Upstream energy firm Gastar Exploration Inc. (GST) declared the pricing of 17,000,000 shares of its common stock. The publicly offered shares have been priced at $6.25 a piece. The company added that it will offer the underwriters a window of 30 days to buy up to 2,550,000 extra units. Depending on customary closing conditions, the stock offering will likely be closed by Sep 24.
After adjusting estimated cost and fees, Gastar Exploration is anticipated to get roughly $101.2 million from the offering. The net proceeds will be utilized to repay debt under revolving credit facility and for general corporate purposes. Gastar Exploration will also use the proceeds for financing its drilling and development programs.
Houston, TX-based Gastar Exploration is primarily involved in upstream activities like exploration, development, and production of crude oil and natural gas. The company mainly explores unconventional resources like shale resource plays.
On Sep 15, 2014, Gastar Exploration declared that it is willing to invest roughly $257.3 million during 2015, of which $222.7 million will be allocated toward drilling, completion and infrastructure expenditure. During 2015, the company projects net average daily production between 15.5–18 thousand barrels of oil equivalent per day.
Currently, Gastar Exploration carries a Zacks Rank #3 (Hold), implying that it will perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, one can look at better-ranked players in the energy sector like Sunoco Logistics Partners LP (SXL), Patterson-UTI Energy Inc. (PTEN) and Cameron International Corporation (CAM). All these stocks sport a Zacks Rank #1 (Strong Buy).
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