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Google: Stratex Oil & Gas amends Eagle Ford Shale Joint Development Agreement
"Under the terms of the Lease, the Primary Term is currently set to expire on February 28, 2014, but may be extended until March 31, 2014, provided that Eagleford Zavala (the lessee) delivers written notice to the lessors and makes a payment of $30,000 on or prior to February 23, 2014. The Lease also requires that, prior to the expiration of the Primary Term, Stratex shall perform either (i) the hydraulic fracturing (the "frac") of the Matthews #1H well or (ii) the spudding of a new well with a targeted depth in a formation capable of producing hydrocarbons. As a result of this requirement, Stratex has committed to perform either the frac of the Matthews #1H or the spudding of a new well on or prior to March 31, 2014. Upon doing so, the Lease will continue thereafter to be held in full force and effect. In return for this commitment, Eagleford Zavala assigned to the Company, an immediate 50% undivided working interest in, and the exclusive right to operate and develop, the entire 2,629 acres covered by the Lease. In the event the frac of the Matthews #1H or the spudding of a new well is not performed by the dates set forth above, then the Lease and the Company's working interest therein, will be null and void. Subsequent to the execution of the First Amendment, Stratex contracted Baker Hughes, Inc. to commence the frac and subsequent completion of the Matthews #1H on February 16, 2014."
I also own STTX
Make that March 31st.
It's my understanding, April 31st is the deadline for the frac well. The log was good, so it should be a good well. Three additional formations look good. Hopefully information is forthcoming.
A SECURE web presence - look at Target. Security is a big concern, so these cheap web solutions are not acceptable to brand name companies.
Seems we are on "the same page."
Articles like this should increase the daily volume/price. I think jgpk will one day be a $100M plus enterprise. The software is easily scalable and growth is exponential (think Oracle, Microsoft in the early days) with added businesses/exposure.
The expansion into Europe/Asia is a whole new profit center. All of those overseas companies need a web presents with shipping logistics in the US - an enormous market!! Not to mention governments, banks, etc.
Good article, I think using JGPK's recent growth rate, the estimated target stock price is higher than $1.15 per share, but in either case it's undervalued.
Thanks, I love this stuff.
I agree completely.
Learned from many years of experience. Unless you have a lot of faith in a businesses value, you typically sell at the worse time - after it drops. My rule is: I only buy companies where I would buy more if the price per share drops. If the company doesn't pass that test, I don't buy.
Anyone know how the frac well is doing?
Anyone know how the eagleford frac well is doing?
Over the last two year since I've owned JGPK they have consistently delivered in excess of 30% per year earnings growth (8 quarters) and the stock has increased from $$0.3 per share. I am happy with the recent increased volume.
The track record is solid. I am not a day trader or gambler, but an investor.
Suggested Reading:
The Intelligent Investor
Book by Benjamin Graham
Next earnings release May 9th.
If you plug their earnings/Growth rate numbers into a intrinsic value calculator, it's worth about $1.6 per share.
When there is a big difference between the price and the value, this difference typically (not always) presents opportunity.
I look more long term. - not day to day trading.
Nice volume!! Went over $1.0 in early trading.
My guess is this company will be acquired because it's trading at a really low price relative to all valuation metrics.
Management owns 71% of the stock, so major "skin in the game."
Huge upside potential in e-commerce for a company that is consistently growing like JGPK. Needless to say, I am a big owner of this stock.
All businesses will need a very secure web presence, so the potential market is huge! Many big clients like Tag, Nespesso, LVMH, Swiss, progenex, etc.
P/E ~16 and a consistent multi-year growth rate ~30 percent.
Target price: $1.60 per share
Check out JGPK's recent earnings.
33% increase in earnings!! Wow, this company is really undervalue. Note, the P/E is ~16 and the growth rate over the past several years is in excess of 30%! Also, expanding business in Europe/Asia.
It's easily worth $1.60 per share. I am in for the long term. Very encouraging!!
Yeah, 33% increase in earnings!! Wow, this company is really undervalue. Note, the P/E is ~16 and the growth rate over the past several years is in excess of 30%! Also, expanding business in Europe/Asia.
It's easily worth $1.60 per share. I am in for the long term. Very encouraging!!
Anyone own EFRDF? The other side of the eagleford deal? On Friday it dropped about 45 percent. Rumors are the stock split 5 to 1, but no news from the company.
EFRDF management needs to provide a status report.
$4MM is good to drill and frac. The profit sharing agreement is reasonable (for
many years, my job was negotiating these agreements). Has the EFS horizontal been frac'ed?
Production rate? How about any other wells? We need to know the rates or we are just "running
in the dark."
April 4th is the next earnings call.
Yes, I was thinking about visiting the leases
myself. I am familiar with the significant asset
potential, but I would like to see some production
data and hear from the field hands. If they want this
stock to really POP more transparency will be necessary.
The next earning date is 3/19/14, and I have really high
hopes!!
Yeah,
Just back of the envelop, for just the eagle ford horizontals, 2,700 acres 80 acre spacing (maybe downspaced later) is ~33 wells. Wells cost roughly $8MM each - $264MM. If we conservatively estimate a profit to investment of 2. ($100 per barrel oil price) we get a $528MM profit.
STXX doesn't own the Zavala county lease in fee, so they have to pay EFRDF, land owners, etc. Let's say they get 25 percent after tax - $132MM. $132MM/ 45MM shares ~ $3/share. I made many assumptions, but the upside if all goes well is large and this doesn't considered the other three reservoirs.
I have a degree in Chemical Engineering and an MBA (finance).
I have owed JGPK for awhile. It's growing 20-30 percent per year and has a P/E around 17. If you plug these numbers into an intrinsic value calculator, the stock is worth ~$1.60 per share. This assumes they can continue to grow at a 20-30 percent per year rate. In this e-commerce space, that is defiantly achievable for a small company like JGPK. This isn't a pump and dump stock that isn't growing and has negative cash flow - it's a high growth profitable enterprise,
I am in for the long term, and I read every work of their financial statements. Next week their quarterly earnings are out. We will see if they can maintain the growth/profitability. I am hoping it will have more liquidity after $1.00 per share.
Hi All:
Good posts. I recently took a position in STXX. I have a BS in Petroleum Engineering and MBA (finance) with over 25 years of acquisition/divestiture, reservoir development, etc. experience. I drill several wells per month, mainly horizontals and some fracs. for a major oil company.
I typically don't buy penny stocks, but this one interested me after looking at the JV agreement. I also like the fact that Alan Gaines is involved - someone that know what there doing. The Ryder Scott report is telling - the reserves were booked as contingent - not proven. This only means they are not in-field drilling - stepping out from current producing wells. The geology is not complex, and the electric logs look good, so the certainty should be high. Also the Bill Cobb reservoir report looks good. Cobb is one on the best in the business, so I trust him. Essentially, there are four oil bearing zones and the eagle ford is just one.
I wish they were more transparent on production, but we will see. Hopefully the production engineers are good.
Take care.