Novus Energy Inc NOVUF

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[largeinvest]

I have a sale price target of $1.50, which is around $92k per flowing

[ardvark11]

so given exit production of 4200 boepd, 210 million shares fully diluted and 92 k$pbbl wouldn't you get 1.84 per share? I would expect debt in.

[cookster9]

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[ardvark11]

I only put the debt in because the value of their tax pools covers it.

[ardvark11]

Looking back at some past deals, I have now convinced myself that a take over bid would be closer to 1.90 than 1.50.  One in point, where crescent point payed almost 400 million in 2011 for viking assets that had about 4200 boepd production but 50/50 oil/gas. Debt was covered.   NVS assets are much better.  The risk is that no offer is madde and it is not competing so low balls

[largeinvest]

Im basically using the valuation provided by the author of the seeking Alpha article and discounting it a bit more then he did for the extra gas.    My price per flowing barrel calculated above is $95,000. Exit rate guidance from Novus is for 4,200 barrels per day. Estimate of value - $95,000 x 4,200 = $399 million Less - net debt of $65 million Add - Option and warrant proceeds $18

[largeinvest]

The $95k per flowing from the author is then supported by a recent asset sale from Long Run exploration. https://longrun.mwnewsroom.com/press-releases/long-run-exploration-ltd-announces-sale-of-non-co-tsx-lre-201211150834961001 Most of us know this already, so this is being posted for the newbies.

[Shlinker_]

Price per flowing barrel calculated is $95,000? not a chance they get near that imho. You have to calculate what % per barrel sold they get in return. Corporate operating netbacks for the three months ended September 30, 2012 decreased 8% to $45.87/boe from $49.78/boe recorded in the comparative period of 2011. For the nine months ended September 30, 2012 corporate operating netbacks increased

[ardvark11]

looks to me like long run just sold the assets and kept the debt and tax pools ewre used to offset the sale.  If Novus sells as a whole, the tax pools are at $245 million at 30% worth $73.4 million or 0.35 per share which gets you to the 1.90-2.00 mark. Nvs can sell all the assets for 95,000 which gets you $399 million, pay the debt off and dividend out  the 1.64 and still sell the

[WHATisMONEY]

I agree with you ardvark11 for the possible price range you suggested. Any range of $1.60 to $1.90 is also possible and not bad.https://markets.ft.com/research/Markets/Tearsheets/Forecasts?s=NVS:CVE