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Gold/Mining/Energy : Canadian Oil & Gas Companies -- Ignore unavailable to you. Want to Upgrade?

To: HAZ who wrote (7468)	8/16/2000 7:31:31 PM
From: Richard Saunders	Read Replies (2) \| Respond to of 24905

haz - tet tethys, etc. No expert however will take a stab. What does mkt. value and n.a.v. imply? Your mkt. value calculation should probably also include addition of debt and then the result would be an indicated enterprise value that "the market" is saying TET is "worth". The n.a.v. is also another way of trying to capture a valuation however the result will depend on what assumptions are made at the front end which are assumed to result in future cashflow. Things like commodity prices, total reserves, etc. all will translate into an assumed valuation number or net asset value. Bottomline, very subjective. You already know that. Re: TET. One other way of looking at historical progress is possibly figuring on a qtrly basis the total production in barrels equivalent per million of shares o/s. If you run thru that exercise you'see growth to be reasonably good. TET annual and qtrly. reports are also quite detailed which allow relatively easy calculation. Other peers aren't quite so forthcoming although generally numbers being reported during the current batch of qtlys. appear much better at detailing disclosure than situations used to do only a few years ago....... suspect it's probably part of trying to regain credibility in the aftermath of some of the major blowups in some memories. There are lots of fundamental ways of looking at things & all are tools. Generally it would seem that key to achieving premium valuations is to be better than one's peers. In TET's case you may want to look at how production increases have been obtained - how much has been acquisition? Generally "the mkt." would seem to give a higher premium to successful explorers vs. "acquirers". Also, indications appear to be that TET may be wanting to still digest the previous Maxwell purchase and as such things like capital return will be stressed vs. nosebleed growth. Possibly "the mkt." is not really attaching more than a normal peer avg. multiple to future cashflow expectations, I don't know, am purely speculating. The other thing that may be happening is that some are saying how can we possibly improve upon overall fundamentals given current o&g pricing, potential shortfalls to winter drill rigs, increasing land sale prices and increasing service sector costs. Are we approaching or passing a peak or is there still some go-go time ahead? Definately interesting times. IF current oil & gas prices hold at similar levels for the next couple+ weeks you'll probably see a bunch of the brokerages (both cdn. & u.s.) re-look at price assumptions being used for the 2000 fiscal year and somemore upgrades will result for those situations that have been able to increase production. IF that occurs I suspect there still may be a little bit of go-go time ahead for some o&g situations. Weather is also a wildcard. One thing for sure, definately interesting times. Jack be nimble......