Even if PVA doesn't get acquired (I am thinking they will), they are well hedged with great liquidity. With oil at $60 dollars a barrel, their hedges are worth over $150 million. Bought in a few days ago with my gains from TLM. Thinking of potentially buying some more on a pull back.
I am going to assume that is part of it. However, it appears as if deep pockets saw fit to add to their portfolio today. Some believe that the bottom is at or near $55. Me, I have the feeling that we are going to see a little bit more down, and the opportunity to start adding shares will increase. This is based on nothing more than knowing how stubborn the Saudi nation can be. They will take oil to $25 if they can. Of course, I could be wrong and we might see a significant rise in oil shortly. Commodities are very hard to play guesses with, as someone else in this world has as much leverage as we do. Best Guess.
given their size position ( 5%), i believe soros would have to file with the SEC if his firm sold shares or bought more shares. SEC Form 4, I believe, with in 2 biz days after and change in ownership.
risk - was considering waiting to determine if Soros has sold shares or continue to sit on them at a much higher price. That will also provide lots of time to do more DD - your comments are always appreciated.
sorry, was looking at SN when i saw your post. luckily PVA just made a couple presentation and updated a few items. I don't believe they will have a capex update until mid Jan. go check out their 2 presentations from last week. they include hedge info, drilling locations, production focus, liquidity and i believe you can also listen to both presentation archived webcasts. again oil price and cost cuts will be key. glta.
risk - was referring to PVA not SN - how do you value PVA and do they have enough cash for operations next 12 months??
In the three geologic formations that account for 88 percent of U.S. shale oil output -- North Dakota’s Bakken and the Eagle Ford and Permian in Texas -- explorers can drill new wells profitably in some areas even if crude falls to $25 a barrel, according to ITG Investment Research Inc.
from the recent update: As of December 7, 2014, SN's liquidity consists of $530 million in cash and an undrawn revolver with a $300 million elected commitment from a $650 million borrowing base. SN has strong financial flexibility and the option to enhance its liquidity if needed by electing the full $650 million borrowing base, which would increase available liquidity to over $1.1 billion. SN expects to fully fund its 2015 capital program through cash and cash equivalents on hand and cash flow from operations without drawing on the Company's revolving credit facility.
$7.7bb? not a snowball's chance... that would be about $90 a sh.
Oil price will dictate everything. Overall, i expect to see production level off in the industry as hedges roll off and capex gets cut. HW came out today with their updated oil forecasts with WTI average $75 in '15, $83 in '16, and longer out going to about $90+ in '18. IMO, those would be very good prices if the expected cost cuts & efficiencies materialize. Adjust CFLO accordingly if numbers prove out. Dilution is always a concern, especially if the traditional lenders get a bit more critical on credits. then you would be getting cash from higher cost sources, potentially private equity investments and/or JVs as well. That being said, dilution of that form is not the worst that could happen, if it allows them the flexibility to increase the value of the company. One thing I am curious about with regard to SN is the tuscaloosa acreage. Seems like it should be mothballed for a while, where leases allow. Selling it would be great I think, but not sure what sort of price tag you could put on it these days. hopefully others there like ECA & GDP can prove up the process and make drilling there cheaper and economical. Great oil cuts, LLS pricing, I think the MS acreage has better royalty structure, and potentially some decent sweet spots, but maybe less uniform than other shale plays.
risk - was your estimate for a buyout $7.7B?? Do we have enough cash for the next 6-12 months and is dilution a concern of yours?
what ever the reason may be, the bottom seems to be put in place for WTI around $55 and for PVA around $4.5-$5.0
hope to see a sustained rally in OIL and PVA