The $20 fall per BBL over the last two weeks hasn't done us any...

The $20 fall per BBL over the last two weeks hasn't done us any favours.

Update issued from Morgans this am:

Sundance Energy (SEA) - Add rating,$0.21 price target

News:

As expectedthe recent strong well results from SEA's Live Oak, Atascosa and McMullendrilling has seen a healthy jump in the borrowing base of its reserve backedlending (RBL) facility.

The RBLborrowing base has been increased from US$87.5m to US$122.5m, with the extraUS$35m increasing SEA's capital buffer on its 2019 development program.

SEA is due toreport its 3Q'CY19 financials this week, which we are hoping will also show anincreased 2019 hedge book, secured at higher oil prices. The last time SEAupdated the market on its 2019 hedge book, it had already hedged ~47% ofexpected 2019 oil production (at weighted average prices betweenUS$62-$67/bbl).

Our view:

We view theexisting hedging and upsized RBL as supplying SEA adequate liquidity to fund itthrough to FCF positive territory (expected 2H'2019). We maintain our Addrating on SEA, with oil price volatility in our view holding down its shareprice despite continued positive developments.

Catalysts:

• SEA's November operational result (<1 week)
• Then SEA's quarterly earnings result (Friday)
• Redetermination of the borrowing base in its RBL facility (c.2 weeks away)
• Speed with which remaining 9-11 wells in 2018 reach initial production (~2 months)

Disclosures:
Analyst owns shares