Global Value Investing

[Koufax]

HRT

I stuck my toe in the water.

Of concern: The company's slide show and most recent conference call indicates R$2.2B in cash, whereas R$1.3 is pledged to secure bank letters of credit issued in connection with the company's option to purchase a 45% interest in one of its exploration plays. If that option is exercised, the cash will be gone and the company will only have about one year of cash left. Expect dilution. Worse, expect overly optimistic investor presentations. Nonetheless, the potential is very large.