Ok, great well GMXR. Here comes the complimentary short lived price spike. They may even pump out another decent well IP PR at some point this month.
The bigger news was the guidence miss for q4 from 60k barrells to 55k. And that number was all ready reduced from 65k, to 60k in November. Guidence for q1 is I think 90k? Not going to happen. So we know they will miss q4 and q1 on oil production.
More news: they have no more money. Out of cash by May probably, that's three months away. They have little options at this point. Dilution, borrow at huge yields and really the only two. They would have had a JV by now if they could, same goes with a land sale. (at this point it would be a fire sale).
Ok sure, no real debt due until 2015. But at the rate they are drilling, by the time they turn a profit, (mid 2014 at best. Count on end of 2014), they will be saddled with roughly 550mill in debt or more. Then what?
In the meantime, more missed guidence, more horrible debt terms, and a volitile stock price that might be ok for short term trades, maybe.
I have seen this movie before, and I know how it ends, common share holder loses money.
Question, how many (by a percent) of the common shareholders (long only) are currently sitting on a gain? Has to single digits, like the ones thatb bought at the bottom today. Even after a decent spike Tuesday, say 15% and it goes to $6.50 - $6.60, their will still be very few holders with a profit. How many people have been here for over a year, like me? How many times have we had hope that it was the turning point, see a nice rally of 15%-20% on some news, only to see it sucked away slowly.
Maybe I am wrong, and for those longs I like, which is most of the guys that post on here, I really do I hope I'm wrong this time. Sadly, I can't bet on it anymore. But I am watching, and if I am wrong, maybe I day trade this thing for $1,000 gains, 80 times, to get my loses back. You never know.
You all know I was a believer, part of me hopes I was right all along and wrong now about the eventual dimise.
Anyone got anything to say, other than the good well news that might make me want to invest again?
"The bigger news was the guidance miss for q4 from 60k barrels to 55k. "
You know the reason why GMXR missed their 4th Quarter Estimate:
THE LANGE #2H WELL wasn't Completed in December.
What made them think they could do 75,000 and then come in at 55,000? They made the 75,000 claim on November 8th. 5 weeks into the quarter. Then they drop it to 60k a week later. Just too many over promise and under delivers for me. Too many excuses.
I know your tired of gmxr but you still know more than most so let me ask you. It looks like gmxr had 55k production from the bakken and 255k boe from the rest. I always use about 50 per barrel to calculate everything out. So these last 4 wells that they have been working on should give us another 6-800 barrels avg a day in production over the next 4-6 months. That being given then we should be looking at roughly 110k in oil and roughly 255k boe equivalent from the rest given the price in now around 3-3.50 for natural gas. Know that comes out to be 365k x 50 and = 18,250,000. This should be after everything including the VP due to the price increase in natural gas (if production does not decline drastically in texas). Now we are paying the interest for the 2018 notes in shares and we have 4.6 million in dividends and other lending activity. So this leaves us ~13.65 million for well completions which are probably running gmxr about 16-17 million on pads. I'm not sure why but my numbers don't seem to be to far off to where we could almost be breaking even and not going any further into debt when we reach say 2000 boe/d is this about what you are getting or anyone for that matter. Of course this is if we just complete 2 wells per quarter which should give us 400 boe/d avg extra for 4-6 months. So worst case senerio we are two pads (6 months) away after the completion of the first pad to not going any further in debt and being sustainable.
Sentiment: Strong Buy
they need 2200 barrells a day for the whole quarter, roughly 210,000 total for the quarter, to sniff a break even or small profit. Problem is, they don't have the cash to get there. Decline rate is killing them on their producing wells and they have not been able to turn out enough good wells to make up for the decline rates.
They only have two options to fund more capex, both screw the retail common shareholder. Dilution or debt with huge interest.
They have effectively run this puppy into the ground.
You can probably make some money trading this thing short term, maybe 1-4 day holding periods. However, I am probably not getting back in. There are many really good companies out there that have no debt and great earings that don't f their shareholders.
Why would I hold on because of a good well or two being announced when they can't even tell us how they are going to fund operations 90 days from now? If I want to gamble, I'll play texas holdem. By the way, I have made more in casinos playing 2-3 texas holdem than I have in this company over the last 12 months.
I don't see a scenario where they come out from under this.
I was holding because I listened to their calls, and presentations and promises and "forward looking" statements. They are so far off of where they should be and where they said they would be.
Do you realize that late 2011 they projected 325,000 barrells of oil for 2012? They came in at what? 203,500. That's a big miss.
Nov 8th presentation they said q4 would be 75,000 barrells. Then a week later they lowered that to 60,000. That's a big drop. And then they come in at 55,000. Pathetic.
Nov 8th presentation said that bakken for October was 21,000 barrells. If they only got 55,000 brls for the quarter, that means Nov and Dec was 34,000 combined. That's the decline rate for you. It's bad. They had no new wells come on in the q4 and the monthly rate went way down. Probably something like 18,000 for nov and 16,000 for dec.
That means jan was probably 13k to 14k. I don't care how good that new well is, it's not going to get them past 70,000 for q1. Which is lower than the original guidence for q4. Pathetic.
If these guys had put up 75,000 for q4, I would still own 120,000 shares. But they didn't come close. They also have not provided any updates on cash flow, another of my reasons to sell.
Who knows, they may turn it around, but I have been saying that for a year now. It's getting old.
NO!!! Trade this sucker for now. Sorry for your lost been there few times myself. :( You should have kept 1000 shares or maybe get a 1000 just for the fun of it. Good luck wish you the best :)
Ps Want to sell also but hoping (sadly) that GMXR will be both out one day for ok price. Just a dream for now.
Simple truth is It's at .43 cents I already lost the majority of my "investment" why sell now. I will let the rest ride just in case $100 Oil gets them back on track. Downside already priced in here, upside could unlimited..