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Big Banc Split Corp T.BNK

Alternate Symbol(s):  T.BNK.PR.A

The investment objectives for the Preferred Shares are to provide their holders with fixed cumulative preferential monthly cash distributions in the amount of $0.05 per Preferred Share ($0.60 per annum or 6.0% per annum on the issue price of $10.00 per Preferred Share) until November 30, 2023 (the Maturity Date) and to return the original issue price of $10.00 to holders on the Maturity Date. The Company will invest on an approximately equally-weighted basis in Portfolio Shares of the following publicly traded Canadian banks: Bank of Montreal; Canadian Imperial Bank of Commerce; National Bank of Canada; Royal Bank of Canada; The Bank of Nova Scotia; and The Toronto-Dominion Bank. The Portfolio will generally be rebalanced on a quarterly basis, starting on September 30, 2020, so that as soon as practicable after each calendar quarter the Portfolio Shares will be held on an approximately equal weight basis.


TSX:BNK - Post by User

Bullboard Posts
Post by arisaig1on Aug 14, 2012 9:14am
237 Views
Post# 20214200

TD Analysis

TD Analysis

Note the comment regarding potential takeover in the next 12 months.

 

 

Investment Conclusion
Bankers’ Q2/12 financial results were essentially in line, but production in Q3/12 – to-date – of 15.4 mbbl/d is
up 9% from 14.2 mbbl/d in Q2/12 (June production was 14.8 mbbl/d), showing that the company has been able
to sustain the recent burst in production growth that started in Q2/12 and could therefore achieve production in
line with our unchanged estimates for H2/12.
Our prior ~50% risking of Bankers’ 2P reserves (when we gave essentially all other International E&Ps 100%
of the booked 2P reserves in our Base NAVPS) now appears overly conservative, given production growth
meeting our expectations over recent months. We are, therefore, increasing the percentage of probable reserves
that we include in our long-term assumptions for Base NAVPS to ~66% from ~50%, which is the main driver
of increased NAVPS estimates and a target price increase to C$4.75 (from C$4.50). We continue to recognize
that issues including interference from old well bores, sand production and water disposal capacity have
affected production performance in 2012, and could also affect year-end reserves estimates.
With a 58% implied return to our new target, we maintain our BUY rating. Bankers is now trading at 0.60x our
Base NAVPS, one of the lowest multiples in our coverage of International E&Ps. Despite share prices reacting
positively to anticipated production growth, we believe that valuation is still sufficiently attractive and that
further expected growth in production and reserves makes Bankers a potential take-out target over the next 12
months.

Bullboard Posts