Longview Oil Corp LGVWF

RE:RE:Longview cuts the dividend/ ramps up growth

[Nawaralsaadi]

Terr,

It is clear that LNV has disappointed on production over the last couple of years, and even if they would have delivered, at best they would have sustained flat production at a $45m capex budget (according to my estimates), which could have capped the stock price at a high yield due to the lack of growth.

I believe the company has a deep and valuable oil portfolio, but it requires a sizable capital investment to unlock it and translate its value into shareholder value. Proper execution will indeed be crucial, but considering their proposed $56m budget, I think their production estimates are quite conservative, for once I believe they will under promise and over deliver.

Of course, now we only have one part of the puzzle, the second part is the AAV review resolution, if we get clarity on that front and combine it with a well executed capex budget, I can easily see a 20% to 30% rise in the stock price next year (brining the yield 8% to 7% yield) or $6 to $6.5 stock price for a total return of 28% to 37%. My initial target of $7 to $8 will probably have to wait until 2015 unless we have a transaction.

Regards,
Nawar