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Sandridge Mississippian Trust II Message Board

dorkymcirish 16 posts  |  Last Activity: Aug 20, 2014 4:39 PM Member since: Sep 28, 2012
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  • I am making a similar post as to the one I made on the CRT message boards to better understand these trusts. I saw that Liza has made comments about owning CRT and SBR and I'm trying to see how to value these trusts. Similar to CRT, SBR, is traidng near its latest PV-10 value but well above its Standardized value. I thought the standardized value was the true one to look at since it took into account taxes. In this case, SBR has 14.58M units and its future net revenue is $576M. Even with higher oil prices, its around $51 per unit in value. The "Standardized measure of discounted future net cash inflows" is around $258M (maybe higher with higher commodity prices) but this is around $25 per unit when you factor in the higher price of oil.

    Liza has always struck me as a value investor so I'm asking why she is a long term investor in this trust. Where is my math going wrong? Thanks for any help from Liza or anyone in understanding why to invest in this.

  • dorkymcirish dorkymcirish Aug 19, 2014 3:16 PM Flag

    Any thoughts on why this has gone up 50%? I thought the low yield would keep it artificially low. However, some non-yield chasers are more than happy to buy this stock. I wonder if it has to do with the other MLP sector news with KMI/KMP/EPB. All were trending up for the past few months.

  • I looked over the annual report and was hoping someone could help me understand it better. For the PV-10 value, it says $210M and for the standardized (is that after taxes?) it says it is at $108M. With 6M outstanding units, the PV-10 value has a per unit price at $35 and the standardized measure is at $18. That is a huge difference and if you go by the standardized measure this is horribly overvalued. If its the pv-10 that is supposed to give you 10% a year than $31 is an okay buy. Thanks for anyone who can help clear this up for me.

  • Reply to

    Reinvest??

    by newpntofview Aug 8, 2014 11:06 AM
    dorkymcirish dorkymcirish Aug 11, 2014 9:23 AM Flag

    I don't agree with this at all. This would assume it trades above $0.01 after its final distribution and then you put all the collected dividends in it. If the final distribution is $1 and its trading at $0.9, its perfectly okay to do this all the way to the end. I would assume the stock would be delisted before the final distribution so it doesn't trade with no value (I forgot if this has residual value). But its probably a poor ideal to do it automatically because of the way these things (DOM, WHX, GNI) have traded in the past.

  • Reply to

    Is there no bottom to this sttock.

    by sandra888us Aug 8, 2014 12:18 PM
    dorkymcirish dorkymcirish Aug 8, 2014 1:58 PM Flag

    Why do you think 60% of the future revenues come from the new wells? I thought they only get 7.5% of the new wells which is probably 5% to 10% of future revenues. With that said, i'm having trouble with this stock so I got out a little below $12 and have yet to re-enter.

  • dorkymcirish dorkymcirish Aug 7, 2014 1:21 PM Flag

    So we will still get more wells but we don't know what we will get? Not that SD's trusts have been reliable in the past with SDR/SDT giving #$%$ wells in those trusts. Now its PER's turn to get #$%$ wells?

    I'm still trying to figure out how big of a deal this is to PER.
    Got my finger on the sell button but would hate to do it if its priced in.

  • Reply to

    From SDs earnings report

    by dristie885 Aug 6, 2014 5:22 PM
    dorkymcirish dorkymcirish Aug 7, 2014 1:18 PM Flag

    According to the last quarterly report I read, it said they drilled 743 wells of the 888. So they drilled another 70 and is that it because of the water issues? I wonder how important those last 80 wells are for the trust. PER was already down 4% today so is this priced in or is this worth closer to 10%?

  • dorkymcirish dorkymcirish Aug 7, 2014 1:08 PM Flag

    Can you explain how important this is for the trust? These last wells that are no longer going to be drilled, would they make up a big % of the trust net worth?

  • From my understanding, this ballot measure could stop any expansion of wells. ROYT was only getting 7.5% on those new wells so it isn't a huge deal but it definitely matters. My question is this. Lets say this ballot measure is written in a sloppy manner. Is there any way it will affect the current wells? I know they already have the permit but I have seen instances of ballot measures causes huge issues with current laws.

    I imagine if that happened the trustee and oil companies would sue the county and it would be dealt with in the courts with possible damages and all that. To me, a long protracted legal case does not sound like a fun investment. I wanted to know the possibilities of that happening. Is anyone out there a lawyer or legal expert or in that area and can confirm? Anyone talk to the trustee yet?

  • Reply to

    input

    by gta0089 Jun 16, 2014 3:01 PM
    dorkymcirish dorkymcirish Jun 26, 2014 10:36 AM Flag

    Seeking alpha just did an update on the value. I'm pretty sure we can't share links here but they have it being worth $16 at a 4% present discount value.

  • Reply to

    Somebody's buying

    by nnononvonav Jun 19, 2014 10:15 AM
    dorkymcirish dorkymcirish Jun 23, 2014 1:30 PM Flag

    I think its worth closer to $17. Its going to pay out another $7.50 or so this year and then about $2.25 dividend next year (the first dividend is usually lower). Add in the $9.72 remainder and you get $19.47. Then you don't get that last payment until the end of 2016. This is over two years to get your $19.47 back if all things go smoothly. To invest in GNI to get above a 5% return you need to get in under $18.

    At the current price of $24.6, some of these longs who forget to sell are are going to suffer a 20% loss in the next two years.

  • Reply to

    7.45 a share?

    by y0da7119 Jun 6, 2014 12:56 PM
    dorkymcirish dorkymcirish Jun 11, 2014 3:58 PM Flag

    Yep. Another 18% today and now I'm out.

  • Reply to

    7.45 a share?

    by y0da7119 Jun 6, 2014 12:56 PM
    dorkymcirish dorkymcirish Jun 11, 2014 9:19 AM Flag

    Well if someone heeded your advice they lost out on the 15% move since your post. At this point you have called both directions wrong. You might want to move on from this stock because you seem too attached and bitter. I'm sorry you lost money, we all do in the market, but its important you spend your time wisely and research other stocks where you can make it up. Good luck.

  • Reply to

    7.45 a share?

    by y0da7119 Jun 6, 2014 12:56 PM
    dorkymcirish dorkymcirish Jun 10, 2014 2:26 PM Flag

    I thought you said you sold this back at $7. Why do you care where it goes?

  • Reply to

    Ouch..offering

    by bigbear.2010 Jun 10, 2014 8:41 AM
    dorkymcirish dorkymcirish Jun 10, 2014 9:45 AM Flag

    I think it was Greenhill Capital partners. They have sold before.
    Google "PACIFIC OIL TRUST GCP" and look at 4th link down for the secform4 link

  • Reply to

    Non-hedged results

    by gpd8252 Mar 20, 2014 8:34 AM
    dorkymcirish dorkymcirish Jun 10, 2014 9:11 AM Flag

    Are we to assume these two are related? That the secondary is right before the new non-hedged results?

SDR
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