CZE/CNCEF: insights pointers.
Here again, as you might charitably say, my analysis is just back-of-envelope.
Using co's 11/10 unaudited interim report I see 93.3m diluted shares. CZE is at $6.76. (I assume currency difference in US$ vs C$6.76 is small enough to ignore.) I use Yahoo's value of $431M-362M =$69 for an estimate to plug into enterprise value (It's a number that's lower, more conservative than just the net cash figure of $75M). This gives a most conservative enterprise value of about $562M vs. Yahoo's $362M number.
Company says production in 2012 isn't going to increase from what's expected to be produced at year-end 2011.
That's not so good. Otoh, those production numbers are expected to be 10-10.5k bopd
Some discussion here (this thread) about using $60-65K per flowing barrel of oil per day, as a metric. As what an acquirer would pay for producing assets.
I make my value case, rightly or wrongly for this particular company, on such flowing barrels of oil. Also, just for a check, its netback numbers seem good to me.
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Stock is volatile. So is its trading volume. Stock seems to be falling past few days. I'm a buyer of both CZE,CNCEF depending into which account I add. I'm in for a little more CZE today.
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For a pointer, I recommend posts by "architect*" on "CANADIAN OIL AND GAS COMPANIES" thread. He has a different way -- likely a much better way -- of making value evaluations, He wants companies with low debt, high cash flow to enable companies to develop their holdings. He seems to follow the Colombian e&p companies pretty closely --- he can discuss specific plays, land holdings and inter-reactions and relationships among many e&p companies involved in South America oil. He holds shares in CZE.
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