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    Stock Alert for Gasco Energy Inc. (GSX)

    Gasco Energy Inc. (GSX) is a natural gas and petroleum exploitation, development and production company engaged in locating and developing hydrocarbon resources, primarily in the Rocky Mountain region.  The Company’s principal business is the acquisition of leasehold interests in petroleum and natural gas rights, either directly or indirectly, and the exploitation and development of properties subject to these leases.  GSX currently focuses its drilling efforts in the Riverbend Project located in the Uinta Basin of northeastern Utah, targeting the Wasatch, Mesaverde, Blackhawk, Mancos, Dakota and Morrison formations.

    Share Statistics (15-July-11)   FY

    2009

    FY

    2010

    %

    Chg

    Q1

    2010

    Q1

    2011

    %

    Chg

    Symbol GSX Revenue, $Mn 21.09 20.26 -3.9% 6.38 4.27 -33.1%
    Current price $0.26 Gross marg. 53.9% 52.5% -2.6% 72.1% 49.9% -30.8%
    52wk Range: $0.20-$0.63 Oper. margin 80.4% 3.5%
    Avg Vol (3m): 976,392 Net margin -238.0% 50.0% -121.0% 45.1% -37.2% -182.5%
    Market Cap. 32.95M              
    Shares Outstanding 126.77M EPS, $ -0.03 -0.06 100.0% 0.03 -0.01 -133.3%

    Source: Reuters.com, SEC Filings.

    Recent News

    GSX shares were boosted last week after the Denver-based energy company provided an interim operations update on its Riverbend Project in Utah’s Uinta Basin and on its California projects in the San Joaquin Basin. The Company said it is finalizing the federal drilling permits for its two Green River Formation oil wells, (GSX-operated / 100% WI), which it expects to spud during the third quarter. GSX has decided to put off its up-hole natural gas well recompletion program until the latter part of the third quarter and into fourth quarter in anticipation of stronger seasonal natural gas prices.

    For its California projects, GSX expects drilling in Northwest McKittrick to commence in the third quarter while it recognizes that the Willow Springs project is still on schedule to have its initial well spud by year-end. It also expects drilling on the Antelope Valley Trend to take place in 2012.

    GSX gained 12.17% to close Friday’s session at $0.26. Over 6.45 million shares have traded hands during the session, compared with the stock’s 10-day average volume of about 568.25K Over the last 52 weeks, GSX has ranged from a low of $0.20 to a high of $0.63.  It is currently trading below its 50-day and 200-day moving averages of $0.36 and $0.42, respectively.

    Financial Summary

    GSX reported a net loss of $1.6 million, or $0.01 per share, for the first quarter 2011, as against a net income of $2.9 million, or $0.03 per share, for the same period in 2010.

    The Company reported derivative gains of $3.3 million attributed to hedge effect in the first quarter of 2010, excluding which the Company would have posted would have posted a net loss of $0.4 million. Excluding derivative gains of $64,000 for first quarter of 2011, GSX would have posted a net loss of $1.7 million for the quarter.  Net loss excluding the effect of derivative gains is a non-GAAP financial measure.

    GSX reported oil and gas sales of  $4.3 million for the quarter, a decrease of 26% from $5.8 million it recorded in the corresponding quarter of 2010. The Company attributed drop in sales to a 26% decrease in prices received for sales of its natural gas and to a 4% decrease in equivalent production during the comparable periods, offset in part by a 16% increase in prices received for oil volumes.

    For the first quarter 2011, the Company reported net cash from operating activities of $0.9 million, as compared to $1.1 million in the same period in 2010.  Net cash used in investing activities during the quarter was $2.7 million, as compared to a net cash of $23.3 million provided by investing activities in prior-year quarter, which is mainly attributed to $23.0 million in proceeds from the sale of the Company’s midstream assets during the prior-year quarter.

    At March 31, 2011, GSX’s cash and cash equivalents totaled $1.1 million, compared to $2.0 million at December 31, 2010.

    Financial Strength (15-July-2011) Company Industry Sector S&P 500
    Quick Ratio (MRQ) 0.33 1.62 0.76 0.72
    Current Ratio (MRQ) 0.45 1.75 1.03 1.06
    LT Debt to Equity (MRQ) 49.90 8.53 14.60 134.17
    Total Debt to Equity (MRQ) 69.54 9.73 19.57 178.09
    Interest Coverage (TTM) 0.22 0.41 2.99 18.55

    Source: Reuters.com, SEC Filings.

    Analyst Consensus

    No analyst recommendations and revisions data available.

    Technical Analysis

    Source: http://stockcharts.com

    On Thursday of last week, GSX closed above its 20-day moving average. This is generally considered to be an indication of a bullish trend.

    GSX is presently near its upper Bollinger Band. This suggests that it is at a high level relative to recent action.

    GSX’s MACD is currently indicating a weak bullish signal. Although the MACD is trending above the signal line, the indicator is still below 0, which suggests that the underlying moving averages are bearish.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    July15-2011 symbol Share, $ $ Mn 2011 2012 2011 2012
    Delta Petroleum Corp. DPTRD            
    Bill Barrett Corp. BBG 46.55 2.15B 30.03 30.03 2.89 2.45
    Anadarko Petroleum Corp. APC 80.01 39.81B 24.17 18.56 2.93 2.57
    Double Eagle Petroleum Co. DBLE 10.68 119.49M 213.60 n/a n/a n/a
    Independent Oil & Gas Median 24.59 n/a 6.88 n/a
    Gasco Energy Inc. GSX 0.26 32.45M n/a n/a 5.20 n/a

    Source: Thomson Financial

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