on recent upgrades aren't up to snuff just using standard metrics. Current industry and sector PE's are running around 20 and you can look at CLR at 33, APA at 20ish, EOG at 20ish. Just on current estimates a PE of 20 ( 2014 est $.039 ) = $7.80 a share....just to be at average. 2015 estimate of $0.56 would have us at
$11.20 pps. An example in the other direction is MHR presently selling at $8.60 pps and look at its stats on price to book multiple...earnings estimates, margins..etc. Sorry if you have a position in MHR..I'm not picking on it ...I'm using it as an example to show how much "herd sentiment" plays a role in pricing a stock. I still believe either the market (herd) just isn't buying the forward growth story of AXAS or it's just a matter of AXAS not getting enough exposure. We are getting more upgrades, Bob is doing a roadshow effort, and the stats and the facts lay out the story pretty well. I almost think it's the chart that scares people but even with the performance over the last year...it's still well under the averages for the performance of the company. We are seriously looking at an exit rate of +7,000 boepd at year end which is 75% increase over 1st qtr and AXAS isn't even at an average PE multiple. I had thought maybe the price to book multiple was making folks timid but try and explain MHR's price to book. I'm convinced however that as long at AXAS keeps on the strategy, the numbers, including book value will increase substantially...and we will get the valuation the stocks deserves. I'd like to see an over-valuation...but just getting up to industry and sector average will reward everyone. I think the numbers say AXAS should be there "NOW"....but it's the market...so we wait but I really don't think we are waiting in vain. The market certainly isn't buying the forward story as yet. JMHO GLTA
I have been saying the same thing...AXAS P/E is not reflective of a growth story. If you take 2H for 2014 and 1H for 2015 you're probably at $.45; 20 P/E gets you to $9.00 fast. I regret not buying more last week when it dipped into $4.60's. Won't make that mistake again.
Sentiment: Strong Buy
I wonder if you have a position in MHR and if not,why not ? Would appreciate your response. I have a position in MHR staring At $2.59, during the audit accounting mix up..
Sentiment: Strong Buy
No mitchjl I don't. I have never owned MHR. I also couldn't comment fairly as to it's value. I used it as an example of it's stats, margins and earnings and price to book multiple in regard to if the herd believes in a stock they pay up...regardless of the numbers...and when they don't believe in a stock they won't pay up. If you have MHR under $3..I'd say you're right. I also don't own CLR,EOG, or APA the other examples I used. GLTA
What has changed the equation for this company is the same one that has changed it for others. Fracking of shale. That has allowed them to focus and they have also had some change of religion as they are getting older. It is a good story but not a unique one. The key is to have recognized what is there. I have already done just fine.
On a good note...I did notice the news article from 24/7 investors..is shown under the main news for "can markets continue new highs"....so maybe we'll get a little wider coverage..not that Yahoo is the WallStreet Journal...but we are getting more and more coverage. At least AXAS was highlighted as a stock with substantial upside. JFYI.....GLTA
Sometimes a fresh perspective can be of use. As a reasonably new holder, I'll give this a go so you can understand my logic.
EPS isn't there to justify too much yet. Why trust 2015 estimates and beyond when we don't know the price of oil will be longer term. AXAS kinda has credibility issues because it makes one ask, what the heck have these guys been doing for the last 35 years they have been in business to be only at 5k barrels a day? Did they make shoes for the first 20 years or something? Are they drilling with a kitchen spoon for the bit?
PV10 seems to be WAY undervalued at 425 mil. (latest presentation) So if you trust it is accurate, if we calculate it out, AXAS is @ a $4 - $4.50 stock. Lets look at book. $1.25? Close? So nothing their to justify a higher price.
Well, .................. what do they have in plays? They are ALL OVER the place (too many really) but NOT in the heart of any single sexy play. And gas is a dirty word. AXAS probably owns the mineral rights under the White House for all I know, but what good is that?. Any 3k per day wells yet? So what chance really is there that PV10 is too conservative?
Compared to the names of the issues above that have real market driving values, except for MHR that is in a sexy play, AXAS has been more of a sector play than an individual stock play so far. Not belittling you or your analysis, this is what I asked myself before I bought. Why am I here? Low debt should mean growing earnings that eventually does come through for a higher valuation if they don't go back into the shoe business. But these guys got serious with their own money and want to cash out now, so they will come through. That .... and continued sector strength. Without sector rotation into the E&P group, AXAS would still be a $3.00 stock. It ran and continues with the group.