SandRidge Energy's Operational Momentum Builds on Cherokee Gains

Company Performance - SandRidge Energy, Inc. has gained 34.7% over the past year, outperforming the industry's decline of 26.8% and the S&P 500's return of 15.8% [1] - The company reported a solid third-quarter performance with average production rising 12% year over year to 19 MBoe per day, and oil output increasing by 49% [3][4] Financial Highlights - Total revenues from oil, natural gas, and NGL increased by 32% year over year to $39.8 million, with net income reported at $16 million, or 44 cents per basic share [4] - Adjusted EBITDA for the quarter was $27.3 million, reflecting benefits from scale and production mix improvements [4] Cherokee Development Program - The ongoing one-rig Cherokee development program has been a major contributor to the quarter's performance, with four wells achieving average peak 30-day initial production rates of 2,000 gross Boe per day, with approximately 43% oil content [5][7] - The first well in the program produced over 275,000 gross Boe in its first 170 days, reinforcing confidence in reservoir quality [8] Balance Sheet and Liquidity - SandRidge Energy ended the quarter with $102.6 million in cash and cash equivalents, maintaining no outstanding debt obligations, which provides flexibility for funding development projects [9] - Cash at quarter-end equaled $2.80 per common share, indicating a strong liquidity position [9] Shareholder Returns - The board declared a dividend of 12 cents per share, payable on November 28, 2025, and the company repurchased 0.6 million shares for $6.4 million in the first nine months of 2025 [10][11] Capital Discipline and Growth Strategy - The company focuses on efficiently growing its asset base while allocating capital to high-return projects, including continued Cherokee development and evaluating M&A opportunities [12] - Management retains the flexibility to adjust capital activity based on commodity price fluctuations [12] Industry Outlook - The 2026 outlook suggests a softer oil-price environment with Brent crude averaging $55 per barrel, while natural gas fundamentals are expected to be stronger with Henry Hub prices averaging $4.01 per MMBtu [13][14] - Rising LNG exports are projected to increase to 16 Bcf/d in 2026, potentially providing additional demand support for U.S. natural gas [13]