As far as natural gas prices, I believe at least for this winter you will see elevated prices, They are starting to creep up again and are at $4. Storage levels are at record low levels as this time of year (about 500 BCF below the 5 yeat average) and the farmer almanic which historically has been more accurate in recent years than NOAA is calling for a brutal winter in the eatern 2/3 of the US. If that is the case natural gas costs could exceed well over $7 which will cause fertilizer costs to go up for everyone but CVR.
You have to appreciate this stock has an extremely low float, so traders can easily move the stock one way or another. Right now the stock at these fertilizer prices is set to return almost $1.35 per year in dividends almost tax free. Thatis pretty good return. My guess that of the 18% float only 2-3% of it is actively traded by individuals that are esentially day traders.
PWE is most vulnerable for a hostle takeover between now and when they report earnings (hopefully on he 14th). I am worried that something will happen, with potential proxy fight . Any offer will be low probably be in the 12-13 range hoping to take advantage of unhapy investors. I would preffer that they stay the course and complete the turn around because the stock potential will be much higher with improving dividends.
This is MLP that is based on returning its free cash flow to the investors not a PR stock like AMZN. You should get out.
I hope you are right, I am counting on 35 cents. still a good return. $1.40 er year in a down year for UAN pricing, is pretty good. the stock should be at 20-21 which would be a 6% plus return.
So nobady gets confused in reading articles cash flow (when some consider the revenue component ) is predicted to decrease by 7% according to one of the Canadian banks, but free cash flow will remain the same. It was slightly positve last quarter and should be even more so this quarter (which is what you should be concerned about). The reason is when CAPEX gets booked to OE the net income goes down but the CAPEX goes down the same amount o net net the free cash flow is same. The dividend is more covered.
When you say everything goes like it should, that means no unscheduled shutdowns, which is always a possibility. As far as the crew goes, I have no complaints, they can't control world pricing of UAN. It appears they handle business very well.
I totally agree, but it does give an indication that PWE may ripe for a hostal takeover, which would be unfortuate. Giving the accounting scandal investers may give up the stock in the $13 range, which is significantly below the value of the company. As a side note IR said that the August 14 earnings release date is still valid, although, it may be delayed a few days, but they are working toward that date.
Looks like based on projected UAN pricing for second half of the year and production guidance, we will be stuck at distribution between 30-35 cents still not to bad return. Pricing is down 10% but production up 10%, indicates revenue should be about the same. OE should be comparible to thisquarter, maybe slightly higher because of additonal fuel costs. I own for distribution, I look for consoldation eventually in this space, with UAN being a prime target, because it is low cost producer.
Don't be worried about CAPEX, CAPEX may go down becsue they reclassify some of the CAPEX spending as expense. Still will drill the same number of wells.
I did not read the borrowing costs would increase and BNN reported the covents that were violated were not financial, which is strange.
Unfortunately management will not make any additional statements or BNN appearences until they report, this may put additional downward pressure on the stock.
They stated the funds flow (which is a proxy for cash flow) was not afftected in 2102 and 2013, but it may be affected in 2014. This may be a result of additonal expenses as result of these accouting errors (maybe royalities), but I understand your statement if operating expenses are increased and CAPEX reduce by a like amount it has no affect on cash flow. I don't think funds flow will be materially affected in 2014, but we will have to see.
You are right. I don't think this will materially affect the financial condition of the company. Cash flow will not change as resuolt of this. I am a little confused on severalaccounting ofr example things depreciation will be slightly less as cpaitla is reduced, what are the affect on taxe s it appears that taxes should go down in this year and prior years.I dont understand how net income or funds flow are not affected in 2012 and 2013 as the press relase stated. BNN reported that the covents that maybe affected are not financial, hopefully they will report as soon as possible.
There is some conflicting information in the news release, they stated that net income and funds flow would not be affected in prior years, but it may affect funds flow going forward. Also in analyzing the the report, in appears cash flow will not be affected that much, although the asset values on the balance sheet will be. .The overall financial health of the company appears to be the same, although tthisaccounting mess up will affect the confidence in the company by investors for several quarters.
My feelings is that almost all of these mid major oil companies with good assets will be brought by the the larger companies at some point to insure oil gorwth for these larger companies. That is why Repsol is on looking.
I would suspect they delayed the earnings release because they wanted to include an announcement of an asset sale that they anticpate closing. I am sure the financials reprts will be done well before July 30.
I do not think the board would accept 13-14 dollar. PWE is still a take out candidiate, but it would be done by a larger canadian oil companies or possibly a US company at much larger price. When this quarter is reported in a few weeks, one slide to look at is the depletion rate vs oil addition, if that swings substantially posiitive, that wuld give a better indication of the growth rate of the company going forward after the sale of the assets. I would imagine that analyist will look at that very closely.