When I first encountered Northern Oil & Gas
Chairman and CEO Michael Reger, a fourth-generation oilman, explained that management, unsalaried at the time, weren't going to pay themselves with shareholders' money before cash started coming in the front door. This approach to compensation, combined with the firm's highly prospective acreage and conservative approach to capital allocation, was enough to win me over.
I closed my outperform call after the stock doubled in a few months' time, but the company has grabbed my attention once again. With the shares sagging, all of management has opted to receive shares in lieu of cash salaries for the next two years. Amid countless companies that lean toward "Pay for Pulse" rather than "Pay for Performance," I applaud the team for aligning themselves with shareholders to this degree.
Northern Oil is a fairly ubiquitous outfit in the North Dakota Bakken oil play. Taking a 3% interest here and a 6.25% interest there, the company takes small working interests in wells drilled by the likes of Marathon Oil
In a play where additional sweet spots like EOG Resources'
Disagree with me, and think this one's a dud? Weigh in with your own call on the stock right here.