Has the market already priced in the impact of this well’s performance, or is there still upside potential for the stock? | TBN (Aug 11, 2025) | Candlesense
TBN

Has the market already priced in the impact of this well’s performance, or is there still upside potential for the stock?

Fundamental view – The SS‑2H ST1 well is now delivering a sustained 6.5 MMcf/d of gas without any choke‑adjustments or down‑hole work‑overs. For a company that still trades at a modest valuation (≈ 10‑12 × EV/EBITDA on the ASX) this kind of “free‑cash‑flow lift” is material – it should lift quarterly production guidance, improve cash‑flow coverage of debt and fund the next round of drilling in the Beetaloo basin. The market has already taken note of the well’s record IP90 flow in the last 30 days (the story is already reflected in a ~70 % positive sentiment score), but the upside is still under‑priced because the well’s performance is still early in its life cycle and the company has not yet quantified the long‑term matrix‑connectivity benefit or the potential to add further wells at similar economics.

Technical & pricing angle – TBN’s shares have been in a tight, low‑volatility range for the past two weeks, trading just below the 20‑day moving average and hovering near a recent swing‑high resistance at $4.20. Volume has been light, suggesting the rally is still driven more by fundamentals than by broad market participation. A modest pull‑back (≈ 3‑4 % below the current level) would likely be absorbed quickly as the production story matures, especially if the next earnings release confirms a step‑up in gas output and cash‑flow.

Actionable insight – The market has only partially priced the well’s upside. A short‑term, low‑risk entry on a dip (e.g., $4.00–$4.05) with a stop just below the 20‑day MA (~$3.85) positions you to capture the remaining upside as the production narrative solidifies and the company upgrades its guidance. If the well continues to hold or improve its flow rate, a breakout above $4.30 would likely trigger momentum buying and could push the stock toward a 10‑12 % upside from current levels. Keep an eye on the upcoming quarterly report for the first hard‑data confirmation of the well’s contribution to earnings.

Other Questions About This News

How will the increased flow rate of 6.5 MMcf/d affect Tamboran’s short‑term production guidance and revenue forecasts? What is the expected contribution of the SS‑2H ST1 well to overall company cash flow and EBITDA in the next quarters? Does the record flow rate trigger any revision to the company’s 2025 reserve estimates or reserve life calculations? Will the stable gas rate over the final 30‑day period influence the timing or scale of any upcoming capital‑expenditure plans? How does the performance of SS‑2H ST1 compare to Tamboran’s other wells in the Beetaloo Basin and to peer operators in the region? Is there any indication that the enhanced matrix connectivity could be replicated at other wells, potentially leading to further production upside? What are the potential risks of a production decline after the 30‑day stable period, and how is the company mitigating them? Will the lack of downhole intervention or choke adjustments affect the well’s operating costs and overall margin profile? Are there any regulatory or infrastructure constraints that could limit the ability to sustain or increase the current flow rate?