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Gold/Mining/Energy : Big Dog's Boom Boom Room
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To: grinder965 who wrote (26073)10/2/2003 9:41:46 PM
From: jim_p  Read Replies (2) of 206287
 
It's a lot more positive that most realize. The institutional money will understand the meaning of the settlement.

1. It will lift an enormous uncertainty on the stock.

2. It will allow credit agencies to raise their ratings.

3. It will allow access to the capital markets and lower the costs of funds to purchase TGN.

4. Every lawsuit filed to date (even in CA) has been dismissed and referred to FERC.

5. The only outstanding issue with FERC is the general refund due to excessive profits which the FERC staff has increased from $1.8B to $3.0B. The FERC staff has proven itself to be very liberal and more on the side of CA than the commissioners. $3.0B in my opinion is the cap which results in RRI getting a $200MM refund.

6. CA is in total disarray and Grey's days are numbered. This should be in RRI's favor. The new leadership will have no reason not to settle the matters and blame Grey for the problems.

7. The last $25MM of the settlement is to paid out of the "profits if any" of plants in CA which are currently unprofitable.

8. The settlement allows management to now focus on operations.


I suspect the lift of the uncertainty will result in upgrades and RRI picking up some new buy recommendations from a few new analyst.

This is the news we have all waited for almost the last year!!

Next stop for RRI should be in the $10-13 range.

Disclosure I have 100% of my investments in RRI at the present time.

Jim

PS: The most positive sign of all is the number of new shorts over on Yahoo that don't know anything about what they are posting on.

Should be interesting tomorrow!!
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