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This company is trading for ~0.6 of its book value and a little over 1 times sales. And it's hedged at over $100 per bbl oil price in December.
Intrinsic value ~$6 per share. Huge upside potential!!
Yes, that is true.
Let's say company X (trading at $3 per sales) buys JGPK (trading at ~$0.25 per sales). It's immediately accretive to company X as long as they pay less than $3 per sales.
Until JGPK gets their PPS in line with the peer group, in my opinion, they are a "no brainer" acquisition target.
I think JGPK can accomplish this increased PPS by going on the Nasdaq and issuing more shares, but if not...
Icahn uses Gaines so he must be good.
STTX can't afford me. An executive level reservoir development asset manager costs ~$500k- $1million per year.
Yeah, me either.
You all know I am not happy it's not a lot higher. I believe just their infrastructure warehouse network is worth more than a few dollars per share even without the software. I have valued this company multiple ways and not one method indicates it's worth less than $1.50 per share. The lowest valuation is based on its intrinsic value (Warren Buffet's number 1 tool) - ~$1.50 per share.
I have been doing this a long time and I have never seen an opportunity like JGPK. I truly believe anyone selling for less than $1.25/share will be really sorry one day.
Titan will actually work a deal where it's free for a percent of the profits.
Most of these small OTC energy companies are run by lawyers and business men not engineers with financial experience. In my experience, all the truly successful oil companies were run by technical people figuring out how to squeeze more oil out at a low cost.
STTX should give Titan a call. Huge opportunities available in the oil patch right now. True wealth is always created during the downside.
Interesting thanks.
Not that many fractured water wet reservoirs in California - oil clings to the pore throat and water is in the middle - low waterflood oil recovery. Clay swelling is typical - can use KCL fluid to help prevent it.
There are chemicals to alter the rock wetability, but not cheap. Also, low pressure is tough in a fractured network - hard to waterflood. Plenty of challenges, but maybe a bigger company can help develop.
I worked on a field in Wyoming that was low pressure water wet. Plenty of stories....
They should work with Titan and see if all the reservoir properties fit a microbes application:
http://www.titanoilrecovery.com
It's a pretty amazing application where the microbes attack the residual oil (attached to the rock) and it works in some fields.
JGPK should be trading at something greater than $1.80 per sales versus $0.25.
Options:
1) get acquired or merge
2) move from OTC exchange to Nasdaq and increase its shares outstanding.
Simple steps to increase the share price from $0.72 to $5.4 per share. As minority shareholders we may need to place pressure on the management team. I think it's "low hanging fruit." Just compare JGPK with its peers.
Side note:
Stock prices increased with a large number of shares trading.
Big sign it's probably done - big increase in oil price and the stock drops big - market is saying this company will not likely make it.
The financially strong companies will come out of this extremely strong.
Like EOG, CLR, and CRZO to name a few. If EF and STTX are lucky they will get bought at a fire sale price. This is when you start negotiating with companies that didn't over extend themselves.
Huge bargains out there for those with cash and low debt. Not sure if we have seen the bottom in price yet, so the best timing is uncertain.
I am amazed someone sold 500 shares for $0.56/share today. Must of really needed money quickly!!
I only know what's been announced about the merger. In this price environment, it's likely a good thing. Hopefully STTX will emerge a stronger company when the price does go up.
The drilling program is likely marginal at $60/bbl and uneconomic below $50/bbl. Most companies are laying down rigs and even giving back leased rigs and paying penalties. Good time to renegotiate with venders and royalty owners. Getting new money from banks will not likely happen now until oil prices exceed $75/BO.
The game has changed - It's all about surviving and being extremely resourceful until oil price eventually go up.
Reworded:
Right now my two favorite funds are DWTI (hedge my oil stocks) and China ETF. JGPK (symbol) an undervalued ecommerce company is my favorite stock.
I am hoping the floor oil price is $60/bbl, but we could see $50 or $40. China is expanding with the oil price drop extra income windfall - will lead to more demand and higher prices eventually- when? I have no idea.
Having been through 1985-86, 1998-99, and 2008. This time I am benefitting from the drop. For me it's like the movie ground hog day.
I would be careful holding any oil company right now that has a high level of debt to equity.
Actual more opportunities on the downside - renegotiate with venders, royalty owner, property tax, acquisitions, upgrade projects, get rid of slackers, etc.. It's good execution on the downside that makes people really rich. Especially attractive to companies with cash and low debt levels.
Right now my two favorite holdings are DWTI (hedge my oil stocks), JGPK (highly undervalued ecommerce company), and China ETF.
I am hoping the floor oil price is $60/bbl, but we could see $50 or $40. China is expanding with the oil price drop extra income windfall - will lead to more demand and higher prices eventually- when? I have no idea.
Having been through 1985-86, 1998-99, and 2008. This time I am benefitting from the drop. For me it's like the movie ground hog day.
I would be careful holding any oil company right now that has a high level of debt to equity.
Right now my two favorite holdings are DWTI (hedge my oil stocks), JGPK (highly undervalued ecommerce company), and China ETF.
I am hoping the floor oil price is $60/bbl, but we could see $50 or $40. China is expanding with the oil price drop extra income windfall - will lead to more demand and higher prices eventually- when? I have no idea.
Having been through 1985-86, 1998-99, and 2008. This time I am benefitting from the drop. For me it's like the movie ground hog day.
I would be careful holding any oil company right now that has a high level of debt to equity.
Ebay is trading at $3.89 per sales versus JGPK $0.25 per sales revenue.
Highly accretive!!
Amazon is trading at $1.84 per sales versus JGPK $0.25 per sales revenue.
Highly accretive!!
I think Amazon should try to acquire highly discounted JGPK (symbol). It's extremely discounted because it's traded on the OTC exchange and only 5 million shares are available to the public - extremely low liquidity. It's trading at $0.25 per sales versus Amazon's much higher $ per sales. It could be a highly accretive acquisition.
Some information:
Latest partnership:
http://www.elasticpath.com/resources/news-and-events/elastic-path-and-jagged-peak-partner-streamline-ecommerce-order-process
Fox News:
I think Ebay should try to acquire highly discounted JGPK (symbol). It's extremely discounted because it's traded on the OTC exchange and only 5 million shares are available to the public - extremely low liquidity. It's trading at $0.25 per sales versus EBays much higher $ per sales. It could be a highly accretive acquisition.
Some information:
Latest partnership:
http://www.elasticpath.com/resources/news-and-events/elastic-path-and-jagged-peak-partner-streamline-ecommerce-order-process
Fox News:
Reworded:
JGPK has some flaws that I think make it highly discounted. As stated before this is what I think makes it a good opportunity.
We are all searching for a small company with an extremely high growth rate, perfectly managed, low SG&A, great ROIC, low debt, better than all peers, etc.
And highly discounted! Please let me know if you can find one of these.
JGPK has some flaws that I think can be corrected and therefore I believe is highly discounted.
Yeah, this is typical of a really fast growing small company.
Again, if things were perfect the stock wouldn't be so discounted. A whale ecommerce company could solve all of these issues quickly.
Yes, I hope so. Management has a fiduciary responsibility to maximize shareholder value - not unjustly enrich themselves even if they are majority owners. Minority shareholders have many rights that we may need to exercise if the share price doesn't converge to a more reasonable share price (based on its peer group).
We may need to take on a Carl Icahn type role. I think JGPK is "exhibit A" in Icahn's book on creating value.
Yes, I've read the information you posted - glassdoor, etc. interesting...
My read is JGPK's CEO is a really high tech guy without much financial background - never held a Wall Street investment banking type job. The CFO is an account, CPA not a finance person.
When I look at JGPK's the next steps to unlocking a lot of value seem obvious.
Yeah, I also think SG&A is too high for their yearly revenue. This high SG&A, lack of liquidity, and trading on the OTC exchange discount is what makes JGPK an attractive acquisition target. Or they can fix these things themselves and get traded on the Nasdaq.
Take away these issues and I think JGPK should trade at a ~$3 per revenue multiple - ~12 times the $0.75/share. If all was perfect then I believe the price per share would likely be much higher and the current $0.75/share opportunity wouldn't be available.
I think it's a pretty easy analysis based on SPDC (and peer group) comparison. When all of these metrics are compared this is a logical conclusion.
I've noticed that if I buy let's say 10,000 shares, in level 2 trading I see something like 3,000. 50. 2,000 50 etc until all the shares are purchased. Just buying what's available in "bucket 1" at price X then moving to "bucket 2".
Personally, I am not sure why anyone would buy/sell less than 100 shares with a ~$10 transaction fee.
Yes, at a $3.1 per sales multiple versus JGPK's $0.25 per sales current market value.
Yeah, let's compare JGPK's shares outstanding/float to SPDC (analog).
Share outstanding:
JGPK: 16 million
SPDC: 66 million
Share available for public trading:
JGPK: 4 million
SPDC: 16 million
I think JGPK's is being highly discounted due to low liquidity. Most of the 4 million shares the public has are not trading because it's held by long-term investors like me.
Solution: move to the Nasdaq (by being acquired or alone) and issue more shares.
Maybe I am missing something, but it's this large discount and potential option(s) that makes JGPK attractive to me.
Can you find another ecommerce company with better financial metrics than JGPK? p/e, ROIC, p/s, lower d/e, etc.? Try
Compare JGPK's metrics to SPDC (symbol). JGPK is better on every level and is trading for seven times less. The reason for this is two fold, 1) JGPK only has only about 5 million shares available to the public to trade and 2) it's traded on the OTC exchange - versus the Nasdaq.
Note, the intrinsic value of the company based on its peer group is at least 7 plus more, but is discounted based on things that can be changed. Management is smart enough to realize this and is taking a big part of their salary is stock (step 1). Step two is to make the changes to realize it's true market value.
I have been involved in many acquisitions/divestitures. When getting my MBA (finance) one of the HBS case studies was Amazon.com. Most ecommerce companies follow this business model and focus on increasing revenue and are traded based $ per sales versus price to earnings. Once JGPK gets enough scale, they can reduce its cost or get acquired by a company that doesn't need their expensive CEO/CFO and executives - this could be highly accretive to another much larger ecommerce company.
I could be wrong, but I think JGPK is real bargain at $0.75 per share.
Happy thanksgiving!
Happy thanksgiving!
Happy Thanksgiving!
I think Speed should try to acquire highly discounted JGPK (symbol). It's extremely discounted because it's traded on the OTC exchange and only 5 million shares are available to the public - extremely low liquidity. It's trading at $0.25 per sales versus speeds $1.79 per sales. It could be a highly accretive acquisition.
Some information:
Latest partnership:
http://www.elasticpath.com/resources/news-and-events/elastic-path-and-jagged-peak-partner-streamline-ecommerce-order-process
Fox News:
All good questions.
I can provide you my experience working as an executive (another industry) for a relatively small high growth company. We ended up taking the company public, and it was a success.
JGPK executives (many founders) likely can get other jobs making as much or more than $300k/year working for larger ecommerce companies. Within these larger companies, the work schedule isn't your entire life like it's working for a relatively small high growth company. Also, the risks are much lower. Additional compensation (mainly stock options) are given to compensate for the additional risk.
Therefore, in order to retain management (willing to basically dedicate their lives and take on additional risk) and incentivize them, some type of stock is necessary. You want management to have a lot of skin in the game - they lose a lot if the business fails. The CEO needs to make sure his team sticks around (not looking for new jobs) while trying to take the company to the next level. Note, the upside stock potential (possibly trading at 7 times more when compare to its peer group) greatly over shadows current compensation.
Yes, optically the salaries look high, and so do the restricted stock awards, but when you consider all options, it makes sense - you don't want people that have taken the company this far to leave (and then try to take your clients). The bulk of management's value should be on the backend - the stock price.
JGPK recently has entered into partnership agreements to lower the risk of having a big client risk providing a significant percent of their cash flow.
http://www.elastic path.com/resources/news-and-events/elastic-path-and-jagged-peak-partner-streamline-ecommerce-order-process
Hopefully this helps.
Yes, I agree. For me it's a long-term investment - solid financial statements and high growth rate.
I am looking for: 1) they get acquired (trading at $0.25/sales versus peer group of ~$2/sales) 2) Get on a better exchange like the Nasdaq with a lot more shares trading to the public 3) keep growing in profitability
The high percent of insider shares provides management a huge incentive to increase shareholder value. My guess is their senior executive have most of their net worth tied to the stock price. This is a good thing.
I think the reason JGPK is trading at a huge discount is due to the things mentioned above. Once these things are changed, the stock price will likely be much higher. Management knows this and is why they want to be compensated with restricted stock.
To see what is possible look at peer SPDC (symbol).
When I received money from a hedge fund and private equity they required about 95% of my net worth to be tied to the business - huge skin the game.
CFO acquiring shares of the stock is always a good sign.
I think JGPK (symbol) is a good U.S. Ecommerce acquisition target for Baba - lots of storage facilities within the US to ship from and highly secure ecommerce ordering/logics software.
Latest partnership:
http://www.elasticpath.com/resources/news-and-events/elastic-path-and-jagged-peak-partner-streamline-ecommerce-order-process
Fox News:
Everyone buying the stock right now is buying it at a $80 million valuation. That includes the whole enterprise.