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My 6 picks are:
CGNW.OB
HSPR.OB
AOBO.OB
VPHM
EGY
ASPN.OB
I would have selected TGB as one of my picks but it doesn't qualify yet.
Mike
Jim,
Your welcome!
I'm not aware of any restriction on sale of these shares. The 8-K on May 10th indicated that the registration of the shares is effective.
The conversion of shares has been going on for some time. During this time the price has been consistently going up. So, I would be surprised if the conversion will cause a dip. On the other hand, this stock has been racing up in price and may be a bit ahead of itself. It is hard to say if you will have an opportunity to get in at a lower price.
Mike
Ham: Re VPHM
I know you asked Bob but I thought I would put in my 2 cents.
All but roughly 5M of the 2009 senior convertible notes are already in the diluted share count. The extra 5M was a purchase option that the existing note holders exercised in April. The extra 5M is small (~10%) in comparison to the 52M outstanding. The last diluted share count was also about 500K shares lower because of averaging. The increase in diluted share count of 5.5M would have happened regardless of whether the conversion occurred. The end result of all of this is that the conversion really has no effect on the diluted share count.
The conversion does greatly improve the balance sheet because the notes are converted to equity and the debt is removed. Since there is no additional dilution, this is a large net positive.
The only negative of the conversion is that VPHM has to pay the remainder of the first 3 years of interest on the notes upon conversion (make whole interest payments). This will impact earnings next quarter.
My take on the overall effect upon the stock is that the conversion will be a positive between now and the next earnings. There will be a bit of a surprise at earnings because some people will not realize the impact to this quarter's earnings. However, I think the stock will quickly overcome that issue. On the other hand, if earnings are great, the make whole interest payments may have little effect on the stock price. Institutional owners will know about the make whole interest payments but many retail investors will not.
Mike
My selling strategy.
I also am better at buying than at selling. I think the reason that as a group we are better at buying than at selling is that we are value investors. It is easier to determine that a stock is grossly undervalued than to determine that it has reached its maximum price. For example, sometimes a grossly undervalued stock grows in value and then becomes a momo stock. How does one determine when the momo has taken the stock to the peak?
My selling strategy for a stock that has appreciated is usually to average out of a stock. It will often take me several weeks to several months to sell out. I don't have a hard and fast rule like lentinman. Usually I start selling when the trailing PE or the forward PE is in the 10 to 12 range. Mostly I use the trailing PE but will sometimes use the forward PE in the case where there is solid evidence that further growth will happen. When I'm averaging out, I am usually selling something like 5-10% of the position at a time.
Obviously, in using this strategy I'm not timing the top. I often end out selling some too early, selling some too late, and selling some just at the peak. On the average, however, I usually end out doing fairly well using this selling strategy. I can't think of a situation where I have had a huge gain and I lost all of the gain. On the other hand, I can think of a few situations where I would have done better to hold longer before selling.
The other thing that this strategy allows me to do is to help keep a particular stock from becoming too large of a percentage of the portfolio. This strategy doesn't completely prevent against that. However, the 10-12 PE usually allows me to start taking gains when the risk of concentration is getting too large.
The stocks that don't do as well are usually sold in response to bad news.
Mike
HWEB re: USAP
Thanks for bringing this stock to our attention. It looks great to me. I picked up 2K over the past few days.
Mike
Re: Search
That was the number one reason that I decided to upgrade several months back. Part of my DD process on stocks recommended here is to reread all of the posts before investing. Usually there is a gap between when I first read about a stock here and complete my DD. Using the search feature helps me to make sure I remember all of the comments on a stock.
Mike
Len Re: Chart
I have a different takeaway from the chart. In 10 year period from 1995 to present the value roughly doubled. Depending upon the period you use in the 70's and 80's you get roughly a double in the 10 year period. The average percentage increase seems relatively constant. Of course, there is also the flat period in the early to mid 90's.
Greenspan has talked about pockets where there is a housing bubble. I have a feeling that this chart supports it. It doesn't look like the average percentage appreciation is much different than other historical times. However, we know that there is much faster appreciation in certain areas. California is one example.
One thing that really surprised me about the chart is that the slope didn't increase drastically in the last few years. A year ago I sold the house that I had lived in for 7 years. I purchased for 178K and sold for 305K. However, I know that the appreciation was much greater in the last few years. In fact, 6 months after I sold there were other houses that were the exact same model that sold for roughly 350K. The house was in a part of the Chicagoland area that was going through rapid appreciation. Not all parts of the Chicagoland area are the same.
I believe that there is a housing bubble. However, I think that there are some places where there is truly a bubble and other places that will experience a minor correction. Time will tell.
One thing to factor in regarding the purchase of a new home is interest rates. Mortgage rates are sure to go up in the near future. I haven't looked into historical rates on the 30 year mortgage but I know that historical rates are much higher than they are now. It is possible that someone may wait for a lower price but end out with a higher monthly payment due to higher interest rates. So, there may be a benefit to paying a higher price. However, expected duration of ownership, amount of equity, and projected inflation/deflation would need to be factored in to determine the best option on a case-by-case basis.
Mike
I second that rally pig motion!
I was up roughly 3% for the day. Today was my best day all year. I'm almost back to break even for the year (-1.4%). Amazingly, I had 22 positions that were up today, 4 unchanged, and only 4 down. I can't ever remember having that high a percentage of positions up on one day.
One thing that I've been doing this year is turning over a big percentage of my portfolio. I turned over about 45% of the portfolio this year which is more than I can ever remember turning over in a 5 month period. Many of my stocks reached a point where I thought they were fully valued so I sold. I also trimmed a few losers. Tax man is going to love me this year :(
Positions I sold this year include (in no particular order):
MDF (my best investment ever!)
FRD
WIRX (sold way too soon)
OVTI
TMCV
PRVH
TMXN
TREK
GACF
HQSM
DNDT
SGMA
BPTR
KILN
SWTX
USOO
TFN
TVIN
Mike
Yield,
Thanks for writing the report.
Did they say anything more about their military sales? It has been 3 months since they announced an order. I wonder how big of an order they need before they make an announcement.
This is my 10th biggest position of roughly 30 positions.
Mike
I picked up 2K additional shares of ASPN for $2.56 on top of my overweight position. In my opinion it is on sale now. I expect ASPN to be at $4 or $5 by the end of the year.
Mike
Bob Re:BWLRF cost cutting...
The MD&A seems to indicate some cost cutting. Here is the quote:
"The acquisition of the Myra Falls mine in 2004 was a significant event for the Company and will be a major focus in 2005. The Company has made important changes to the on-site
management and believes there is an opportunity to significantly improve the performance of this mine."
Myra Falls has the highest cost of all the mines. Myra Falls cost is $0.44/lb. The average cost for all of the mines is $0.40/lb. Bouchard Herbert, the mine that ceased production this quarter, has a cost of $0.27/lb.
Clearly they are doing the right thing by focusing on Myra Falls given its higher costs and the fact that it produces the most volume. The question is how much cost can they squeeze out and how profitable will this make them.
Thanks for the feedback.
Mike
Cliffvb re: BWLRF
You aren't the only person who missed the report. I was reading it while you were posting.
The quarter was better than Q4 but wasn't as good as I had hoped. The good news is that they have been working on operational improvements at Myra Falls and there are still more improvements to be done. The bad news (already known) is that they stopped production at Bouchard-Herbert and they project that they will stop production at Bougrine in Sept. The big question is what happens with zinc prices.
I'm not sure how to read this stock and am interested in other opinions. I can see it performing good, bad, or average. I'm interested in other opinions on this stock. Anyone, anyone, Bobwins?
Mike
ASPN PR out
Aspen Exploration Reports Strong Third Quarter 2005 Results
Friday May 13, 11:10 am ET
Third Quarter Revenues Increase 164% to $1.16 Million Resulting in Net Income Increase of 812% to 11 Cents Per Diluted Share; Strong Production Gains Enhance Results
DENVER, CO--(MARKET WIRE)--May 13, 2005 -- Aspen Exploration Corporation (OTC BB:ASPN.OB - News), an energy company with offices in Bakersfield, California, and Denver, Colorado, announced today results for its third fiscal quarter and nine months ended March 31, 2005. For the third quarter the Company reported revenues of $1,164,000, an increase of 164% as compared to the year-earlier period, and net after tax profit of $702,500 compared to $77,000 a year earlier, an increase of 812%. Aspen reported earnings of $0.11 per diluted share, compared with earnings of $0.01 per diluted share for the prior year three month period.
ADVERTISEMENT
For the nine months ended March 31, 2005, the Company reported revenues of $3,138,000, an increase of 149% as compared to the year-earlier period, and net after tax profit of $1,386,000 compared to $220,000 a year earlier, an increase of 530%. Aspen reported earnings of $0.21 per diluted share compared with earnings of $0.04 per diluted share for the prior year nine month period.
The Company reported higher revenues as a result of an increase in production volumes from recent gas discoveries and higher prevailing prices for natural gas. Gas production for the nine months ended March 31, 2005 was 1,740 MCF per day, an increase of 112% versus the same period in fiscal 2004. Net income before interest, depletion, depreciation and taxes was $2,299,000, or $0.35 per share, compared to $609,000, or $0.10 per share for the prior nine month period.
Based upon the increasing production levels and continued strong gas prices, which currently exceed $6.00 per MCF, Aspen expects continued strong earnings for the balance of the year.
Aspen's stock is quoted on the OTC Bulletin Board under the symbol ASPN. For more information concerning oil and gas operations contact Bob Cohan, President and CEO, in Aspen's Bakersfield office at (661) 831-4669. Aspen's web page can be found at www.aspenexploration.com.
DISCLAIMER
This news release contains information that is "forward-looking" in that it describes events and conditions which Aspen Exploration Corporation ("Aspen") reasonably expects to occur in the future. Expectations for the future performance of the business of Aspen are dependent upon a number of factors, and there can be no assurance that Aspen will achieve the results as contemplated herein and there can be no assurance that Aspen will be able to conduct its operations or production from its properties will continue as contemplated herein. Certain statements contained in this report using the terms "may," "expects to," and other terms denoting future possibilities, are forward-looking statements. The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks which are beyond the Company's ability to predict or control and which may cause actual results to differ materially from the projections or estimates contained herein. These risks include, but are not limited to: the possibility that the described operations (including any proposed exploration or development drilling) will not be completed on economic terms, if at all, or the estimates of reserves may not be accurate. The exploration for, and development and production of, oil and gas are an enterprises attendant with high risk, including the risk of fluctuating prices for oil and natural gas, imports of petroleum products from other countries, the risks of not encountering adequate resources despite expending large sums of money, and the risk that test results and reserve estimates may not be accurate, notwithstanding appropriate precautions. Many of these risks are described herein and in Aspen's annual report on Form 10-KSB, and it is important that each person reviewing this report understand the significant risks attendant to the operations of Aspen. Aspen disclaims any obligation to update any forward-looking statement made herein.
ASPEN EXPLORATION CORPORATION
2050 S. Oneida St., Ste. 208
Denver, CO 80224-2426
Telephone: (303) 639-9860
Fax: (303) 639-9863
Email: aecorp2@qwest.net
Web Site: http://www.aspenexploration.com
hweb2, re EGY:
Welcome aboard!
I've been really surprised that EGY hasn't taken off since Q1 earnings. I've been adding to my position during the last couple of days. Eventually the market will see the value.
Mike
Estimates for EGY:
I just did estimates for EGY for the remainder of the year. I'm estimating $0.22 for Q2, and $0.16 for both Q3 and Q4. This gives a total of $0.66 for the whole year.
The reason that Q2 is higher is that I assumed that the development costs for the year will be almost completely in that quarter. If the development continues into Q3 then Q3 earnings will be higher than my estimates and Q2 earnings will be lower than my estimates.
The estimate was based upon oil prices of $46.75 (price to EGY). I also estimated Etame 6H coming online at the beginning of Q3. That is probably a bit aggressive.
Yahoo says there is one analyst and his estimate for 2005 is $0.45. This estimate hasn't been updated in 90 days, however.
Mike
hweb re: HSPR.OB
I reviewed this company in detail and I think it has much potential. One thing bothers me, however. I think they have some one-time gains or other special situations in Q1'05. They estimate Q1'05 will have sales of $1.7M, GP of 580K, and EBITDA of 250K. If their only operating expense is SG&A, then SG&A would be 330K. Their SG&A for the past 4 quarters has been as follows:
- Q4'04 = 906K
- Q3'04 = 2,595K
- Q2'04 = 806K
- Q1'04 = 793K
I'm finding it hard to believe that they were able to drop their SG&A to less than half of the lowest quarter last year. Because of this, I'm inclined to believe that there is some one time benefit that they didn't disclose as a part of their estimate.
If there is some special situation going on in Q1'05, what is the impact for the full year.
I'm interested in buying this stock, but the reason for the outstanding EPS in a quarter with very low revenue makes me wonder about their accounting and transparency.
Does anyone have a good explanation for Q1'05?
Mike
PDGE - $4 Million in new contracts
The $4 Million in new work is in addition to their 38.8 Million backlog. To put this in perspective, in their last quarter they had $18.7 Million of revenue. Last quarter was the best quarter all year. Due to the large backlog, they have several quarters of outstanding results in the bag.
The press release is below.
PDG Environmental, Inc. Announces $4.0 Million in New Contracts
Tuesday April 19, 8:01 am ET
PITTSBURGH--(BUSINESS WIRE)--April 19, 2005--PDG Environmental, Inc. (OTC BB: PDGE - News), an environmental and specialty contractor, today reported that it has been awarded two contracts totaling in excess of $4.0 million.
The first contract for $3.2 million is for asbestos abatement and partial demolition of a closed school in Pittsburgh in preparation for future redevelopment of the building and site. The project will start within the next thirty days and is scheduled for completion in six months. The second contract for $860,000 is for asbestos abatement at an industrial facility near Portland, Oregon. This project will start May 2, 2005 and be completed in four months.
John Regan, Chairman and CEO, commented, "These new awards will help maintain the positive momentum from last fiscal year and demonstrate PDGE's geographic diversity and ability to respond to large projects throughout the Country."
PDG Environmental, Inc., is an environmental and specialty contractor providing asbestos and lead abatement, insulation, microbial remediation and demolition and related services dedicated to assisting its commercial, industrial and governmental clients in complying with environmental laws and regulations. Regional marketing and project operations are conducted through branch offices located in New York City, NY; Paramus, NJ; Hazelton and Export, PA; Fort Lauderdale and Tampa, FL; Houston and Pasadena, TX; Phoenix, AZ; Rock Hill, SC; Portland, OR; Seattle, WA; and Los Angeles, CA. For additional information on the company, please visit http://www.pdge.com. And for more information on mold and its effect on indoor air quality, please visit http://www.epa.gov/iaq/molds/index.html.
Safe Harbor Statement under Private Securities Act of 1995: The statements contained in this release, which are not historical facts, may be deemed to contain forward-looking statements, including, but not limited to, deployment of new services, growth of customer base, and growth of service area, among other items. Actual results may differ materially from those anticipated in any forward-looking statement with regard to magnitude, timing or other factors. Deviation may result from risk and uncertainties, including, without limitation, the Company's dependence on third parties, market conditions for the sale of services, availability of capital, operational risks on contracts, and other risks and uncertainties. The Company disclaims any obligation to update information contained in any forward-looking statement.
OT: researcher59, SSKILLZ: Margin Leverage
I suspect that many on the board are leveraged but are not using margin. If you have a home mortgage and have investements it is esentially the same thing as margin. I've never used margin but have a mortgage so I am leveraged. In fact, when I purchased a new house in late 2003 and sold my former house in mid 2004, I purposely decided to hold a mortgage (my former house was smaller and was paid off). My average return since the end of 1999 is 21.5%. That is much better than mortgage rates.
In the last week I have raised more cash. I'm at roughly 17.5% cash but I still have the leverage of a mortgage. That is the highest percentage cash I have ever intentionally had. I'm continuing to raise more cash by accelerating the sale of some of my longer term investments that I feel don't have as much of a chance of appreciating. I've also moved some money to income producing investments which I believe provide more safety in a down market.
Mike
Thanks to everyone who has posted their top positions. A special thanks to SSKILLZ1 for compiling the data. When I suggested that we do this I had no idea that we would have such an awesome participation level.
I think this data provides a number of valuable items to the board members. The most valuable thing that I think it does for me is to help me identify targets for more due diligence. As this board has grown, it has become impossible for most of us to perform DD on all of the stocks that have been posted. Even performing at least minimal DD on all stocks and then deeper DD on the good ones is more than a full time job. The fact that 37 responders have 196 unique stocks in their top 10 (or so) gives us an indication of the magnitude of the work. Just imagine how big the list would be if we posted a complete list of our stocks!
One other thing that happens to me and I suspect many others is that my DD gets stale on stocks I don't own. For example, a while back I did some DD on ETEC.OB but took a pass because I felt it was overvalued. Because of the top ten posts I reviewed the stock again. The price has come down considerably and now I think it is a very good value. Consequently, I purchased some on Monday.
My plan is to start at the top of the list and review each position that I do not own and then perform at least some DD. I think this should generate at least a few more investment ideas quickly. In general, I already perform DD on stocks that are frequently discussed. This process helps me identify ones that I have missed or that I passed on and should take a second look.
Thanks again for everyones response! I'm a bit biased, but I think that this is the best board that is available on the internet. At a minimum, if there is another board I haven't found it yet.
Mike
USOO Insurance Issue
I found some interesting information regarding the lawsuit in the recent 1.7M judgement against the USOO subsidiary CAM Transport. The insurance company that is contesting their liability in this case seems to be closely related to USOO. The 10K indicates the following:
- The 10K says the insurance company is American Inter-fidelity Exchange.
- Several members of the board of directors have a relationship with American Inter-fidelity.
- USOO has an investment in American Inter-fidelity Exchange.
- For fiscal 2004, USOO accounted for approximately 85% of the total premium revenue of AIFE.
The relationship between the company and their insurance carrier is very complex and I am wondering what is going on here. I'm guessing that USOO's assessment that they aren't going to be covered for this judgement is more than just conservative thinking.
Any thoughts about what is going on here?
I used to own USOO but sold out when the price ran up in Feb. I am considering getting back in again.
Mike
Top 10 positions
It would be interesting for people to post their top 10 positions. Mine are as follows (biggest to smallest):
ASPN
DFC
PDGE
MDF
IMPL
DAAT
EGY
SWTX
NWD
PKZ
These positions comprise roughly 45% of my entire portfolio. I'm investmented in roughly 35 different stocks. The only one of the top 10 I have near term plans to liquidate is DFC. Also, I'm still in the process of adding to EGY.
I'd be interested to know the top 10 positions of others on the board.
Mike
Death, Argyll re: OTCBB/Canadian stocks
Thanks for your replies. I wouldn't be surprised if they gave me the wrong info. It traded shortly after I called so my immediate problem was resolved. I am interested about the controls that they give regarding execution. I'm going to investigate further when I have some time.
Mike
Ameritrade Trading of Canadian Stocks/Executions
I was having a problem today purchasing some BWLRF stock using Ameritrade. I has a bid that was .001 higher than the ask but it was not executing. After it sat there for 5 - 10 minutes without trading I called Ameritrade. What they told me was that dual listed stocks get sent to the Canadian exchange instead of the OTCBB. I'm not sure if this happens all of the time or it was just in this case. I forgot to ask. The level 2 information applies to the OTCBB and not TSX. So, even though it looked like it should trade on the OTCBB, it was not trading because it was sent to the TSX. I also found out that if I specify INET for routing it will force the trade to go to the OTCBB instead of the TSX. I'm not sure if there is a way to force it to go to TSX. Maybe specifying automatic does that.
I've noticed more issues with execution lately with Ameritrade as has been reported on this board. Whenever I am having an execution problem I call up Ameritrade and complain and they find out what is going on. So far, they have always taken care of me.
I like the fact that Ameritrade will trade the stock on the Canadian exchanges with the standard commission rate. It provides more liquidity which is nice for us in microcap land.
Mike
Researcher, Wade re SWTX
They mentioned in the call that there were many special charges in 2004. If these charges were not there I think they said that they would have made 15 to 16 cents in 2004. I don't remember the exact number. So, earnings will not necessarily drop.
In the call they stated that income should be 9 or 10 percent to 13 percent of revenue. If we assume the 10 percent revenue increase guidance that they gave, use the 10% to 13% range, and assume that the diluted share count is the same, the income rage is in the 19 to 25 cent range.
I haven't had a chance to go back and look at the possibility of further increases in the diluted share count. They did say in the call that they don't have a need to do more equity funding.
I get the feeling that management is conservative in their estimates so I wouldn't be surprised to see them exceed their guidance.
One other nice thing in the press release is the significant balance sheet improvement. They went from a negative book value to $0.48/share.
Mike
Bobwins: CPE
I think that you are on to something with CPE. I've spent the last several hours doing DD on this company. Some things that I have noticed beyond the points that you mentioned are:
1. Yahoo lists earnings estimates from 1.32 to 2.72 with an average of 2.04. This is the largest earnings spread I have ever seen for a stock covered by 5 analysts.
2. The hedges that they have done were not the greatest moves since they locked in lower prices. The old hedges are working their way out so revenue should increase assuming constant oil and gas prices.
3. The number of shares outstanding will be higher YOY in the upcoming quarters due to a secondary offering that they did last year.
4. They currently are not paying taxes.
5. The $80M drilling budget that you pointed out is huge for a company with a $275M market cap.
Given the information above, I think a fair value is more like $20 since I assume that the analyst estimates are not taxed (Assumptions EPS= $2.25, PE = 12, 25% Tax). The big wildcard seems to be the increases in production that we can expect from their drilling program. I'm having a hard time figuring out what the real potential of these wells is since I haven't found any information that indicates the production increase potential. What are your thoughts on the potential of their drilling programs? I'm assuming that you think the quality of their drilling prospects is what makes them worth a PE of 20.
Mike
TSTA PR out...
WATERLOO, Ontario--(BUSINESS WIRE)--Feb. 15, 2005--TURBOSONIC TECHNOLOGIES, INC. (OTCBB:TSTA - News), a leading provider of air pollution control technology, today announced the following unaudited operating results for the second quarter and first six months of its fiscal year ending June 30, 2005:
Three Months Ended Six Months Ended
12/31/04 12/31/03 12/31/04 12/31/03
US Dollars
Total Revenues $ 1,226,956 $ 729,899 $ 3,673,991 $ 1,876,519
Net Income
(Loss) $ (473,421) $ (426,728) $ (346,165) $ (616,224)
Net Income
(Loss) per
Share $ ( 0.05) $ ( 0.04) $ ( 0.03) $ ( 0.06)
Weighted
Average
Number
of Shares
Outstanding 10,507,224 10,507,250 10,507,224 10,507,250
Commenting on the Company's results, Edward Spink, TurboSonic's Chairman and CEO, said, "Following two successive profitable quarters, we are dissatisfied with the second quarter results for our current fiscal year. Significant foreign exchange losses and provision for rework on an OEM project negatively impacted our results. If our revenue for the first six months of fiscal 2005 is combined with our current backlog, substantially all of which we expect to complete prior to the end of fiscal 2005, including $1.5 million in new orders booked in the past six weeks, it is likely that our revenue for fiscal 2005 will be approximately double that of our prior fiscal year. We are pleased with the strides we are making in our target markets, including China and South America. Significant repeat orders are demonstrating the emphasis that TurboSonic places on customer satisfaction and value."
TurboSonic Technologies designs and markets air pollution control technologies to industrial customers worldwide. Its products are designed to meet and exceed the strictest emissions regulations, improve performance, reduce operating costs and recover valuable by-products.
Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward-looking statement. Factors that impact such forward-looking statements include, among others, changes in general economic conditions, interest rates, government regulations, and competition. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statement, see the annual report on Form 10-KSB and other documents the Company files from time to time with the Securities and Exchange Commission.
TurboSonic Technologies, Inc.
550 Parkside Drive,
Waterloo, Ontario, Canada
N2L 5V4
TurboSonic Technologies Inc. (OTC Bulletin Board:TSTA - News)
--------------------------------------------------------------------------------
Contact:
TurboSonic Technologies, Inc.
Patrick Forde
President
(519) 885-5513
Fax: (519) 885-6992
info@turbosonic.com
www.turbosonic.com
ASPN is now my #1 position due to the great run over the past 6 months. Go ASPN!
Thanks Bobwins for bringing this one to the board!
Mike
Len - List of value microcaps
I think a list of value microcaps on top of the board is a great idea. It certainly would make DD easier.
If we had a list like that, another thing we could do is vote periodically on which stocks we like best for a particular time frame. This would show all readers which stocks collectively we think have the best prospects.
I think that both ideas would help all of us make more money.
Mike
PKZ
I think a few people on the board own this one but I'm not sure. This isn't a microcap since it has a market cap of 2.9B but seems to fit our value model to a T. They made $5.62 over the past 9 months and should make $7-$8/share for 2004. They closed today at $37.8. For 2005 they are projecting production of 170,000 bopd which is up from 151,103 bopd for 2004. Also, they are buying back shares, have minimial outstanding options and convertible security (only 1,688,545 shares vs. 76M outstanding), and are paying a dividend.
This seems like a screaming buy. Is there something I am missing? I own a small position and am considering making it much bigger. Any thoughts are appreciated.
Mike
The better sales in December probably is related to the hunting season. Typically you clean a gun after the hunting season. The cleaning process involves removing residue and oiling the gun.
For example, in Wisconsin where a larger percentage of the state goes deer hunting, the hunting season is the week of November.
Mike
mrgreen re: veteran
Word on what?
Mike
Researcher re: HICKA,
Sorry. You were right that they are terminating their registration. When I looked at HICKA on Yahoo I couldn't see that PR. They don't even have it on their web site. I had to dig it out of EDGAR. I think the double 8-K's on Aug 11 messed me up when I looked at EDGAR the first time. It is interesting that only that PR states their intention despite several PRs regarding the tender offer. I think this was very intentional.
Thanks again.
Mike
Researcher re TREK:
Thanks for your thoughts. HICKA went from the Nasdaq SC to the OTCBB. TREK is going from the OTCBB to (hopefully) the pink sheets. HICKA is keeping its SEC registration whereas TREK is terminating its registration. Unless I missed something, these are very different situations.
Mike
Trek - Any thoughts as to whether this will be traded on the pink sheets. My past two experiences with delisted stocks is that they trade on the pink sheets. However, there was no mention of trading on the pink sheets in the PR. Also, Trek is much more thinly traded than my other experiences.
Mike
Bob: BSIC.OB
I reviewed my DD notes on BSIC. One thing to remember is that they are not paying taxes now. Having said that, if their revenues and earnings are growing, BSIC may still be a good value.
One thing I started doing this year as I do DD is to take notes on each company. I have notes on almost 30 companies now. I'm finding that it is getting harder to keep track of the companies and the notes have been very useful.
Mike
mrgreen,
I did some EPS calculations for Veteran Resources. My calculations show 2005 EPS in the range of $0.042 to $0.078 with BOE prices in the $40-$45 range. I used a BOE number of 1,350 for these calculations. Veteran is estimating 1900 BOE at the end of 2005. On an annual basis this is still only $0.12 at an average oil price of $45. Where did you find your EPS estimate or how did you calculate it? Also, is the 10-15 cent EPS you are discussing for all of 2005?
My calculations for the annualization of the 1900 BOE number at $45 per BOE are as follows:
Depletion & Depreciation = $15.25/BOE
Production Expense = $9.96/BOE
Royalty = $6.43/BOE
Diluted shares = 67,101,706
(1900 BOE/day * 365 days * ($45 - $15.25 - $9.96 - $6.43 per BOE) - $1,328,156)/67,101,706 = $0.118 annualized EPS
Mike
Wade,
While it is true that the value of oil and NG stocks are dependent upon the market price of these commodities, it is only one factor. Some of the oil and NG companies should see significant increases in their production volume over the next 12 to 24 months. Two examples of this I see are ASPN and EGY. Increases in production volume can counteract a drop in commodity price that might happen. I'm not a good person to speculate on how the prices of oil and NG are going to change.
One other point is that NG prices are not related much at all to the economic situation in China. NG can't be transported without liquification which isn't done much at all in North America. NG usage is more closely tied to the weather in the location it is being sold.
This past week I added to my position in EGY. I think it is a good value at this point. I think it is going to take 6 to 18 months for EGY to really take off however. That is, unless oil prices skyrocket again.
Mike
EGY: Thanks for the feedback Bobwins.
I intend to hold for the long term also and may add some more in the next few days depending upon how the market goes. Right now my position in EGY is not that big relative to my other oil and gas stocks and my portfolio as a whole. As far as oil and gas stocks go, I'm also in ASPN (big position), TMXN, KCS, PKZ, and TREK.
Mike
Bobwins - Any thoughts on my post #505 regarding EGY future earnings. If you have a moment to look at it I would appreciate it.
Mike
EGY: Thoughts on earnings.
I'm wondering what people think the diluted EPS flow for EGY will be over the next couple of quarters. Q4 seems pretty easy to estimate at $0.10 to $0.12. I came to this number as follows:
- Q4 sales will be 420,000 barrels vs. 447,000 barrels for Q3. Increased prices will offset the decreased # of barrels thus revenue will be similar to Q3. I haven't taken a detailed look at what the average barrel price will be for Q4 but Q3 was $40.80.
- The expense structure should be similar to Q3.
- Switching to profit oil is a $0.04 to $0.06 hit per the EGY release.
- Q3 diluted EPS was $0.16 therefore the profit should be $0.10 to $0.12.
Q1'05 seems like it will be lower than Q4 because of the increased amount of "profit oil." I'm guessing diluted EPS of something like $0.07.
Earnings should go up sequentially in Q2'05 because there will be more drilling activity and thus less "profit oil." I'm guessing something like $0.10.
Q3 seems trickier because Etame 6H could come on line (assuming success). Also, the amount of "profit oil" is harder to guess.
Obviously, changes in oil prices will affect the estimates.
I'm thinking about buying more. Any thoughts on the earnings estimates.
Mike