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Warren Resources, Inc. Message Board

  • mark_471951 mark_471951 Mar 25, 2011 10:42 AM Flag

    The Funds are coming at $5.00

    If we get to five and hold we will see a few days of up volume and share price in mid 5.00 range failrly quick. Company with low to no debt and proven reserves the market has too see that, the buy rating today proves that. 5.90 befor next earnings.
    My guess

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    • Company is not without debt...Approximately $70MM drawn on the revolver, with $50MM still available. Believe they have approximately $15MM cash on hand, giving them $55MM net debt.

      So, not a killer load of debt, but not quite trivial. Company has used proceeds from '09 equity offering along with internally-generated ebitda to pay down $40ishMM debt in past 15-18 months, which is a nice showing.

      Add to that the fact that company spent approx $38MM in capex in 2010 and has budgeted $59MM in 2011, and company has a very nice trajectory.

      If, as I have posted on other threads, the company can start off Jan 2012 with approximately 3500-4000 bopd prodcution, company could be able to make even bigger debt paydown in 2012 while simultaneously affording a larger capex program...$100 oil in 2012 could help WRES to generate approximately $150MM in top line revenues.

      So,yes, the company has some very favorable resources to develop and should also be able to reduce debt even further in the year ahead

      • 1 Reply to sumark4221
      • Sumark is correct. I remember back in 2009 when our credit facility was drawn to close to $120 million (pretty much maxed out) and it was up for redetermination. Very scary. The equity offering (although dilutive) saved our butts.

        One thing I have noticed over the years: Whenever Norm makes an insider buy, the stock always seems to go up shortly thereafter. It happened at $.50, $3, and now recently in the low $4's. Not saying there is anything nefarious going on, just an observation.

    • Answer: Pritchard Capital Upgrades Warren Resources to Buy

0.0860.000(0.00%)Jun 7 3:59 PMEDT