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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Broken_Clock who wrote (17294)	6/23/2003 4:50:40 PM
From: John Carragher	Respond to of 78702

chk one of the stocks mentioned this weekend in barrons round table.

To: Broken_Clock who wrote (17294)	6/23/2003 10:57:38 PM
From: Area51	Read Replies (2) \| Respond to of 78702

Re TMR versus CHK. I'll go out on a limb and predict that TMR 2004 earnings will be comparable to CHK earnings which makes it my E&P investment of choice. Here is an optimistic view of TMR prospects (I wouldn't expect average NG of $5.75 in 2004, $4 per MCF is probably better for planning purposes and even that has potential downside). messages.yahoo.com I like CHK as well and considered buying it around $10. If it declined much from here without too much deterioration in the natural gas outlook I would be a buyer. As someone stated it depends somewhat on the valuation model. If you look at Enterprise Value per mcf reserves I estimated CHK as $1.42/ mcfe of reserves (good) and TMR as $2.36 per mcfe reserves (expensive). As long as TMR can add reserves with a finding cost of less than $1.42 per mcfe (which it appears they can with the Biloxi properties) they'll still be fine. Both of these companies have a lot of debt relative to many of this threads preferred investments. Both will struggle if natural gas prices decline below $2.50 per mcfe for an extended period of time. And of course I reserve the right to be wrong <g>