PTAXF is really the same thing as PTA.V. You buy PTAXF and there is some process where the pink sheet market maker "creates it" by depositing PTA.V shares with your broker. Spoke to my etrade rep awhile back to understand the process better. Many of the Canadian listed companies (including some much larger ones than Petroamerica) also trade on the pink sheets in the same manner.
Pacific Rubiales paid 335 mil (including the 185 mil carry) for 49% of block Z-1. That was a couple of years ago and the other 51% has got to be worth much more now with production increasing, fields proven and new prospects identified on the 3D sonar. Might be nice for PRE to acquire the other 49% of block Z-1 and 100% of the on-shore blocks. They still owe about 75 mil in the carry to BPZ. If they buy the whole company, they save that expense - which reduces the cost. $500 - $600 mil would be quite a bargain for them if management wants to sell.
Red, to be fair DRL is probably not going to zero. More likely to get massively diluted in a capital raise / preferred stock swap than seized by the FDIC. The BPOP "vulture" play really is boring. I'd put the odds of them getting gifted a piece of Doral by the FDIC at less than 1 in 10.
Here's an interesting microcap for the day traders to look at. Check out CBDE. Still drifting lower (debt holders got shares in the IPO at $4 and are cashing out) , but this one is going to take off at some point. Legit solar play trading at less than 1X revenues and moving into US residential solar market with financing and a brand name (Westinghouse with 20 year guarantee on the panels). Market cap under 25 mil. Just moved over from Australian listing to NASDAQ. All the Liberal idiots wanting to save the planet are bound to find it at some point - LOL.
No, I don't think it's trading at a forward pe of below 2X. Let's give them the benefit of the doubt and assume that they made 10 mil (or something like that) in operating profit on their Thailand project. They are still going to have interest costs, administrative costs etc. Furthermore they are still at the startup stage in the US retail solar sector (which I think is the most exciting part of the company based on the excitement for Solar City trading at 25X revenues and others in that market space). At best they are going to use profits from other areas to help fund rapid growth in the US retail market and possibly the UK retail market.
This is a growth story for the next couple of years - not an earnings story. SCTY is trading at 25X revenues and is not yet profitable. If this company can get to near breakeven and grow rapidly, investors would be very happy.
I agree that the enterprise value / revenue multiple looks good on CBDE. However, I don't think you are correct in counting the total project cost as "revenue". I would count their fee received for managing the project, which would be a fraction of the total project cost. Also you need to use the enterprise value - not the market cap. The enterprise value includes the debt and is almost 2X the market cap (hard to keep track with all the recent moves to convert debt to equity though). CBDE is certainly trading at enterprise value / revenues of less than 1X (cheapest I can find in the solar sector). It might even be trading at less than 50% of 2015 revenues. However 10% of revenues? No, I don't think so. It's cheap, but not that cheap.
The stock is undervalued, but I'm not surprised to get a little pullback after the big move it's had in the last couple of weeks since higher reserves, analyst upgrades and the Value Digger article came out. The whole oil sector was under pressure today. With regards to volume, you should really look at the combined volume for PTA.V (trading in Canada which normally accounts for a large majority of the trading) and PTAXF (US trading on the pink sheets). PTAXF trading was higher than normal, but PTA.V trading was actually below average volume. Trading has picked up a lot lately in PTAXF relative to PTA.V. This is an indication that more US investors have "found" this gem. The fact that Petroamerica is starting to appeal to a wider group of investors will help get the stock price to fair value. The company is expected to reverse split the stock (probably in the next few months) to make it more appealing to institutional investors. Very positive for the stock in this case as many institutions won't own a stock trading at under $1 regardless of how good the fundamentals are.
mockingjay, this was a company that had serious financial problems in 2013. They had convertible notes that were in default due to project construction delays and had to pay 15% interest on them. The good news is that they have really cleaned up the balance sheet a lot with the IPO as well as many note holders also swapping for shares at $3 - $4 / share. No doubt those conversions account for much of the selling we are seeing now. Debt holders usually don't want to be stockholders and convert in order to sell the shares and cash out. Takes awhile to clear out that "overhang" of stock and provides a nice opportunity to pickup shares even though fundamentals are improving.
You can read stuff like this in the IPO prospectus:
· Our interest expense increased from A$2.0 million in fiscal year 2012 to #$%$9 million in fiscal year 2013. The year-over-year increase was due primarily to (i) the accrual of interest on our high-cost construction loan facility, which was drawn during the last months of fiscal 2012 to fund the Italian solar projects and which remained outstanding for 6 months during 2013 while we worked to consummate the sale of those projects and (ii) greater interest accrued on our Series 1 Convertible Notes, which were outstanding for the full fiscal 2013 year as compared with only one month during fiscal year 2012 and which accrued interest at default rates of 15% for approximately 6 months of fiscal year 2013.
Liquidity was very tight at this company if you go back before the NASDAQ listing. With the NASDAQ IPO and simultaneous swap of some debt for equity their balance sheet has improved. Before that they were really scrambling for cash and you can see it in the favorable terms given in some of the prior capital raises. If you have debt or preferred issues with high interest rates that can also convert to common on favorable terms it's not great for common shareholders.
A lot of that early stuff has been unwound. The reason you're seeing a pullback in the stock now, is that some shareholders got their shares very cheaply from those deals and are cashing out after the IPO. Fundamentals look pretty good, but some selling until that stuff gets cleared out.
frontline, my thinking (which has been correct so far) is that PR will present their flawed case rather than settle. That way they can claim they "fought for the people" (or other similar propaganda). If they settle before losing in court, I think they lose face politically.
stockhouse is pretty good. Also a lot of discussion on the PTA message board there. Less obnoxious stuff on the Canadian boards than most yahoo boards as well.
Why would you guys even worry about nonsense like that? This is such a solid company. Strong cash flow, great balance sheet, great management, current on SEDAR filings in Canada, good Board, proper auditing, no big legal issues, etc. There are some stocks I lose sleep trading. This isn't one of them.
Olejos, looks interesting. Will check it out. By the way you are NOT off-topic. They just completed the Miller well and this is the Miller message board. Better reflect on that one, message board police.
Vancouver, British Columbia / TNW-ACCESSWIRE / May 21, 2014: Avanti Energy Inc. (TSXV: AVN) ("the Company" or "Avanti") is pleased to announce its recent success in establishing commercial production from the VUA Miller #1 Well. After a week's production, the well has averaged 196 barrels of oil per day (bopd) and 246 mcf of gas
Listening to Foulger is like listening to Russia claiming that they did not invade Ukraine. I wonder how enrollment for his Fall Propaganda 101 Course is going. Lots of left wingers no doubt at that 3rd rate community college where he teaches. Course should fill up early.
It is obvious that PR has no case. They made a political decision to try and stiff DRL out of a legal agreement which is now backfiring resulting in much worse payment terms than the original agreement. Arrogant politicians figured they could get the lawyers to come up with "something" to justify their political decision. PR has lost every battle in court. Their arguments show a childish sense of arrogant govt entitlement. Their lawyers might as well have showed up in court and argued " Your momma!".
There are a couple of incentives that are typically used to entice debt holders to take a voluntary swap. New debt can be secured or more senior. That puts holders that don't swap behind holders that do. Not sure how they could structure that type of swap for DXM.
With regards to the publicly traded bonds, perhaps they could offer to swap some of those for common stock or convertible debt.
The Value Digger article is pretty good. Picked this one up as a Panick Report pick at lower levels. Still way undervalued though.
If the market was always correct, I wouldn't bother to trade. There are a lot of reasons for the discount (although they are fast disappearing). Trades primarily in Canda as PTA.V (ptaxf is the pink sheets for US investors). Stock price is too low for US investors and they will do a reverse split to remedy that. In Canada it trades on Venture exchange rather than the more respectable Toronto (probably will move there within a year). It was a smaller company, but is growing rapidly with the Suroco merger and active drilling. It was very depending on production from 1 oil field, but is becoming larger and more diversified rapidly. There were some community issues (famers blocking roads) for some of their fields, but those are becoming less of a factor. There were security issues in some regions of Colombia but FARC is being routed by the army and is negotiating a peace treaty. Sector is out of favor, etc.
My newsletter and email alert service (Panick Value Research Report) is focused on undervalued off-the beaten path micro caps like PTAXF and microcap distressed debt issues like the DRL pref issues. Yahoo mail mrpanick if you want a copy.
No positon in the DRL common or the BPOP issues. Still have a little bit of the DRL pref issues since I think there will be a swap offer. I have traded the BPOP preferred issues and successfully traded BPOP puts (although not lately). Let me let you in on a little secret about BPOP. You can't just go by their direct exposure to PR muni bonds, PR direct govt loans and development loans guaranteed by PR. That is just the tip of the iceburg of their exposure. If PR defaults, don't you think all real estate there is going to take a dump? How much indirect exposure does BPOP have? A lot. When Greece went down it effected all the Greek banks. PR is the same thing.
I track the PR Govt Development Bank bonds for an advance warning of a PR default. If the muni bonds dump I buy BPOP puts to make money and hedge my DRL pref position. I wouldn't sleep well owning a big BPOP position with muni bonds trading near 70. If you want a better long term holding try PTAXF. Great balance sheet, great management, growing fast, trading at 1/3 of peers (which are themselves undervalued) and making money hand over fist.
I'm no lawyer, but I've worked with lawyers on some cases for a former boss who was involved in a lot of litigation. Trying to sue a government or regulatory entity for damages is a losing battle. Think it's called sovereign immunity. They are essentially immune from that type of lawsuit. DRL can't sue PR for damages anymore than a family can sue "The Liar in Chief" because he promised that health care costs would decline by $2,500 for the average family if the Unaffordable Health Care Act was passed. You can't sue because you liked your doctor & old health plan and can't keep them. Now if a corporation acted in such a bad manner, they would be sued endlessly for false advertising and various other offenses. Hacienda is virtually immune. The best DRL can hope to do is recover the money they've stolen.
I hate to doubt the great Bloomberg, but I think they are likely to sell the NPA's in PR and keep the "good bank there". Then again, you never know. They could sell the profitable mainland US assets and back out of the PR sales altogether. I wouldn't bet on the vultures Red. There are plenty of buyers for the profitable mainland US assets and Wells Fargo (King of the jungle) may yet eat their meal.