Antero Resources Consolidates Impressive IPO Performance

Michael Teague  |

Denver, Colorado-based Antero Resources ($AR), the newest downstream energy company to enter the market, was having another big day on Friday.

The natural gas producer held its IPO on Thursday under the guidance of the private equity firm that controls it, Warburg Pincus LLC. While the debut offering of 30 million shares had been priced between $38 and $42, Warburg had to up both of these figures to meet demand, selling nearly 36 million shares at $44 a piece by the closing bell, and raising over $1.5 billion.

Antero’s operations are located in the Utica and Marcellus shale formations in the Northeastern portion of the US. According to its own estimates, Antero has nearly doubled its proven reserves since December of 2012 to over 6.3 trillion cubic feet.

The stock is attractive for reasons other than impressive reserves, however. For the second quarter of 2013, the company reported a 115 percent increase in production on a year-over-year basis, and has allocated nearly $1.5 billion of its capital budget to drilling, exploration, and well completion for the same period.

Indeed, the company certainly seems to be well-positioned to rise in the current domestic production climate. The Appalachian Basin in which both the Utica and Marcellus formations are located is one of the epicenters of the energy renaissance currently playing out in the US, a trend whose outcome is hardly predictable, but has in general favored smaller producers.

Shares of the $13.23 billion Antero Resources closed Thursday at $52, and show no signs of letting up for the moment. Friday trading saw the stock adding almost 5 percent to $54.48 midway through the session.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
AR Antero Resources Corporation 11.31 -0.85 -6.99 5,809,978 Trade
CFIGY Challenger Ltd. ADR 70.38 0.00 0.00 0

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