to me with shares in EQU which had a very F***Ked-up management (these guys
at DEJ look like geniuses comparably). in any event EQU is sitting on loads of oil and
the shares were dropping for no apparent reasons but, long termers were buying all the way down.
in 2012 a shareholder revolt gained traction and an this year was an offer to buy the company. shares
up today over 9% and buyout will occur soon. what has happened at DEJ is almost
a picture image of the BS I went through at EQU.
the point is DEJ IS SITTING ON LAND WITH RESOURCES which is it's real VALUE.
DON'T SELL AT THESE PRICES.
I have no opinions on management or who is "gaming" the shares but be sure it's happening.
A R/S by itself will not affect SP, and since it will keep SP for DEJ way under $1 (remember stock holders authorized a 5:1 R/S) it does not make sense.
On the other hand a R/S followed by a secondary offering, provided DEJ finds an investor, will easily drive SP down another 30-40% or even more. Although SP will go down the drain in case of a R/S followed by a secondary, DEJ could bottom out and start a comeback. They will have to use any money received in a secondary in a very wise way, i.e. drill more KOKO wells, pay off debt, AND they will have to cut their expenses by 40% or more to convince investors they will not squander the money generated in bonuses and cheap options for themselves.
Another option is to sell some portion of their land, and use money to drill more wells. This has been tried with WR non producing acreage, but has not materialized. Guess big companies are not willing to pay DEJ top or any $ for unproven acreage.
Looking at BOE/D produced in last quarter, and the fact KOKO is very rich in NGL (they bundled NGL and oil together for WR and KOKO) it is obvious WR production is going down the drain. They cannot survive on what they currently have in KOKO. They need additional revenue.
The next 3-4 months will be very critical for the company.
Anybody who sells stock here months before they drill a mancos and additional Williams Fork wells obviously has no clue what this company is doing or they have a short-term time horizon.
I don't like to see the stock where it is. Kokopelli in and of itself this very moment is worth multiples of the current market cap. That's not spin or homerism. That's just reality. It's just the unvarnished truth.
Hodgkinson has several million of his own money tied up into Kokopelli. There is no way on the planet he's going to walk away from this company without making darn sure he has recouped that money.
If the company has to sell Woodrush, whatever it takes, you can be sure that it WILL drill a mancos at Kokopelli. This one play, again, is worth several multiples of the current market cap. And that alone is why I will not sell a share. It can drop to $0.10 a share for all I care. I've got an extremely long-term time horizon and a vast majority of the longs in this company do as well.
We're all frustrated with the stock price. And we should be. But this is an asset play. Period. It's not a MHR in the making or for that matter a KOG. This isn't a company that'll be here in 10 years with 15-25,000 BOEPD. This is an exploration company and with the management team in its mid 60's, they're not going anywhere until Kokopelli and basically the entire Garfield County acreage shifts to proven, producing reserves with several mancos wells (over the course of their remaining Garfield County play).
I have no idea on the when. But I know the what. And that's why I'm not going anywhere. This is a broken stock littered with retail investors and most of these folks do not have a 2-3+ year time horizon and most of them don't see that a $4-5 million investment in a mancos can double or possibly triple the current proven producing reserves.
Sentiment: Strong Buy
good thread .. and spot on comments harold
nobody here can be happy with the current stock price, including equity raise summer of 2012 where banks bought in at I believe .25/share .. basically no-one has made a dime as investors thus far, and thus the recent panic sell-off (despite nothing new?)
But longs and banks know what's really the value here .. the DEJ assets .. and need to stay calm and be patient. The only signs I am wary of are partial sell-off of assets or continued dillution, and I believe management has milked their high salaries a bit too long. I am not sure the direct reason for the 40% pay cuts, but I'd like to think it's their conscience. :)
I've seen this company go year after year just missing to turn a profit mostly due to high-payrolls, but hung in here knowing what could and should happen long term.
Of concern on the last quarterly is the diminishing acres of undeveloped land ? I am long and strong, but the slow drip sell off of assets to basically make payroll is starting to test my patience.
I am not selling .. no way .. but I am also not buying either right now. Prove me wrong Hodge.
it appears no many shares available for selling or trading now, that means more shares are becoming long holding. I think majority of people buy or hold DEJ for long holding and very few people buy DEJ for trade recently because both buying and selling are becoming difficult for profit. For example, if you want to buy a big amount you must bid higher and if you want to sell a big amount you must ask lower, and if you buy or sell a small amount you will pay higher percentage for the commission fee. So, for traders, they will not be interested in DEJ anymore.
very intelligent thinking, thank you...nice to read sound thinking instead of the usual
still holding my 250K and recommend buying at current price...I reached my goal
between 8/12 and 11/13.
Good post. My sentiments as well. WR, deep drilling rights, and surrounding acreage that we own will benefit from the new Northern Gateway Pipeline. Should the company continue to drill or simply sell this BC asset, they are inline to benefit from the recent agreement between Alberta and BC to move this project forward. Hodgkinson and the board (specifically Dr. A. Ross Gorrell & Richard Kennedy) are fully in the loop regarding this pipeline and are aligning the company to benefit IMO. Take note that they had interested parties in the JV offering but chose not to give the farm away knowing the pipeline would move out of the infancy stage and become a reality as it now appears. People have questioned why we have a board that is heavy on the Canadian side. Do some DD on the Gateway pipeline and you will find your answer. GH5
Thanks for that info. I looked up the company and saw their Diluted EPS jumped from a negative $1.73 in 2010 to a positive $1.59 for year-end 2012. That's a heck of a jump! As many have posted on this board - and I tend to agree - 2014 will be the year for DEJ. As the assets go from "probable to proven to production" the company becomes more and more a target for JV, Merger or Buyout. This could happen at any time as there are some entities that might want to complete a transaction before the tax year ends. (Mgmt has been very hush-hush and reluctant to provide any information) I also agree with you that someone is "gaming" the shares.