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  • jimjones62 Jun 19, 2012 8:49 AM Flag

    more food for thought

    pv10 iss 2.5 billion on p1p2reserves of 76 million boe
    -400million net debt approx
    dividend by 57 million fully diluted shares= $36 a share
    or 400+% above current stock price.

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    • No surprise, you have just about every detail wrong in your "valuation" analysis.

      Nobody uses pre-tax to value stocks unless they are clueless - not when NS has ~60% tax rates. But no surprise that the BS Brigade (aka "top management") conspicuously fails to publish after tax values - and clueless investors use that as their pie-in-the-sky valuation metric.

      As for NAV, cut the US natgas assets NAV in half - they used significantly higher price deck than current strip pricing.

      Debt is around $600MM.

      FD share count is 58.9MM, not 57MM.

      My guess is 2P NPV10 after tax is somewhere in the $1.5B range. Deduct $600MM debt and NAV is around ~$900MM.

      Divide by 58.9MM FD shares = ~$15 share - roughly 100% upside, which is about average in the sector.

      But you get a highly levered company vs others (like Ithaca) who have pristine cashed up, debt free balance sheets yet who trade similar discounts to NAV as END. Now what would a savvy investor do? Buy the highly levered, second rate company, or the cashed up leader in the sector?

      • 2 Replies to crucible401
      • jimjones62 Jun 23, 2012 5:31 AM Flag

        1) You are asinine to write down value of reserves by a billion dollars due to US NG price, little of our 74 million boe in reserves are booked in US.

        2) Ithaca is your go to....good lord have seen the blacks they have and the declining production profile. Tell me where will their growth come from?

        3) yes pretax value especially when we will not pay corp income in Uk for many years with our op. loss carry forward and investments in Uk prodcution, we will generate 2billion in cashflow to the comapney prior to paying any kind of meaningful tax in UK.

        4)You are really reaching here...58.9 not 57 million share!!!!...So you take into acct resticted stock that will or won't be awarded, either way a deviation of 3%...who cares, really, you are quite full of yourself guy...

        50 Debt is as i states, fully dilutes, we are not highly levered debt to ebitda of 2:1 vs. 4:1 industry...


        You are good for a laugh though.

    • Agreed this is cheap, but the low price is a reflection of management not meeting deadlines and making a couple of blunders.

      A few positive pr's or update on production #'s will be the push w eneed to get back to 12 - 15.

      Good luck