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

To: E_K_S who wrote (42132)	4/3/2011 5:00:02 PM
From: E_K_S	Read Replies (1) \| Respond to of 78516

Re: Lucas Energy, Inc. Common Stock (AMEX: LEI ) - A simple back of the envelope analysis. Here is an edit to my earlier post regarding LEI's JV deal w/ MRO. My take away from the Little Tom Field Analysis: eagleford.com 1) On pg-17- :"...The 5,237 acres within the Dyami Little Tom reported leasehold has an Eagle Ford Shale oil resource potential of 8 million barrels based on reported parameters from EOG (130 acre spacing unit) and Petrohawk (200,000 barrel oil recovery per well) as discussed earlier in this report..." They concluded that their 5,237 acres parcel had an Eagle Ford Shale oil reserve of 8 million barrels. This implies that LEI's 1,000 acres could contain as much as 1.5 million barrels. (They are similar formations and geographic locations) A 50% interest would net them 750K barrels of possible field reserves. 2) The report (pg-37-) calculates a recovery cost for Eagle Ford shale of between $32.27/barrel & $38.56/barrel. For this analysis I will assume $35.00/barrel. If you assume $80.00/barrel avg price, LEI could net $45.00/barrel on their share of oil produced over the life of the field. Therefore the total Net value of their share of probable reserves (ie 750K barrels) could be worth as much as $33.75 million or about $2.03/share. Depending on the specific terms of the MRO JV deal and how their "actual" developmental and production expenses are shared, LEI could receive additional recovery cost credits from MRO for the 50% interest consideration already received. Therefore, my WAG of $33.75 million (or $2.03/share) is at the low end estimate of possible value(s). ----------------------------------------------------------------------- The stock was up $0.46/share on the news Friday (inter day as high as $1.05/share). The MRO JV deal could be worth as much as $2.03/share and much more if Oil stays above $80/barrel. As a result LEI's shares s/b valued between $5.50-$6.00 and IMO remains 35%-50% undervalued. The company has other ongoing JV deals and additional acreage that can also be developed in the future which could add further value to the shares. EKS

To: E_K_S who wrote (42132)	4/3/2011 9:20:11 PM
From: Paul Senior	Respond to of 78516

EKS. I'm looking at forward p/e's to determine if analysts consenus is for less earnings in future year. So if analysts get the direction correct, and that direction is for lower earnings (much higher p/e), I'll be looking to sell. I'm also looking at p/e and p/bk to see if they are in line with historical averages. (If so, I'll also want to sell)

To: E_K_S who wrote (42132)	4/4/2011 5:37:20 PM
From: Paul Senior	Read Replies (6) \| Respond to of 78516

I continue to trim as market advances. Fearful of insurers/reinsurers and seeking to cut back on my exposure to them, I'll take a loss on recently acquired OB: In 1/11 @ $14.84, I closed now @ $14.04. As airline HA falls, I'll continue to cut back too and take losses: In 12/10 @ $7.90, cut at $5.92. Trimmed PLPC @$74.99; in at $28.30 (6/10) Closed stub MCK @ $79.58; in at $36.35 (11/08) (Again, the benefit of holding a stub position) GOV: trimmed at $26.85; in at $25.69 (11/10) Will consider adding back if stock falls to yield higher AA: trimmed at $17.56; in at $11.39 (9/10) BK: trimmed at $30.34; in at $25-27 (6/10-7/10) I have expected this one to have recovered more than it has. FMC: trimmed $86.39; in at $44.84 (7/09) EPD: trimmed @43.20; in at $38.02 (9/10) My k-1 shows negative UBTI, which for me is a big positive. EPD k-1 report shows maybe a necessity for filing for 5 k-1's representing other sub lp's that EPD has shares of. My accountant will not be happy when I see him this Friday. I'll make repurchases of EPD in ira. FLY: trimmed @ $14.14; in at $7.04 (6/09) Okay for this aircraft lessor. Again, still unsure and concerned why aircraft engine lessor WLFC has stalled (-g-, sorry) at a low level. Trimmed more high cost WLFC shares: 05/10 sh. in at $11+, sold today at $12.99. QCOM: trimmed at $53.43; in at $37.27 (5/10) WMAR: trimmed at $10.13; in small 12/10 @$9.64 I've not mentioned this specialty retailer of boating equipment before. Stock near stated bv, cash more than debt. I just lost some courage: not sure I want to weather a downturn in business if/as recreational boating takes a dive. ALEX: trimmed stub @ 53.79. Stock popped Friday on large investment by activist investor, Pershing Square. Bought @ $17-22 with purchases 2-3/09. Again, benefit of holding a stub position...and of buying almost anything 3/09.