Possible reasons why said analysis is flawed:
1) Oil prices are on the way down.... Until oil prices drop below $30 per barrel and is expected to stay there for an extended period of time making in not profitable to drill in ultra deep water, I won't be too concerned....
2) ERHE will be spending quite a bit of its cash arguing for some of its rights.... do the reseach... ERHE already (with no cash in the bank) fought and won in international courts, their rights. The last PR was ERHE publically putting STP on point to maintain what has already been argued and won. On top of that, ERHE has $30 Million in the bank with no debt.
3) ERHE has 4 to 6 employees who are researching options that they might try to leverage going forward. Reality is that the employees along with all knowledgeable shareholders are waiting to prove the oil rights out. We will all be "focusing" on the % gain of the shares as the data rolls in.
4) Delays, delays, delays...priced in, priced in, priced in... Likely to be a $5 - $10 per share stock when oil proved across their rights currently trading at .20. Nuff said
5) Huge bargains to be had in the market right now in much safer securities..... yeah, like WAMU (the fourth largest bank in the USA) looked just weeks ago. Those same "safe" stocks were bargains yesterday, last week, and likely tomorrow. Nothing against them... I suggest diversifying.. have some of them too.
6) With 6 or fewer employees, $30 million in the bank, no exploratory cash flow pressure, and 40% owned and previously backed by a Billionaire... I am also not worried about finding future credit in this market....Maybe those "safe" companies need to worry more about their credit than cash rich ERHE.....
Good luck with your investment strategy.
