Current prices yield a reserve value of $ 187.5 million, or a break-up value for the company, at a conservative 50% discount for oil in the ground, (with 17 million shares outstanding, of which 14.5 million are insider held) of over $5 per share. All this is without inclusion of the companies latest acquisition (White River Dome in Colorado), the details of which have just been announced (see Investors Business Daily, April 19, page A17). I will report these reserves and valuations following some independent verification, but they are in the same ballpark as Marvin Davis' lucrative deal mentioned above.
The section posted above is from two years ago. They were talking over $5 with 17 million shares outstanding. Now they are talking over $3 with less than 4 million outstanding. Both IMO are way overvalued. Another thing is that past performance does give an indication as to what to expect in the future. Looking from the numbers above, it looks like the value is decreasing.
Also, look at the deals they were working on and closed in the starting post. Not much has come of them.
Good luck to current shareholders, I hope it does go to 3 and you could get out with some money.
Eric |
