TSXV:CEN.H - Post by User
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CalifDreamingon Sep 03, 2008 6:30pm
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Krazy Kozak at it again - $7.50 target
Krazy Kozak at it again - $7.50 targetHonestly, I am amazed that Kozak can keep his job. His DD is lousy.
He issued an update on CEN yesterday. Still maintaining his $7.50 target but basing entirely on reserve valuation and not cash flow. I guess it's the lazy man's way of pretending to be a professional analyst. Basing values on year end NPV means virtually nothing a company does during the year will have any impact on your target price (and thus, very little work is needed). In this case, a delay in production means nothing. And a significant increase in guidance to 20,000 bpd in Q4 '09 means nothing either. It's criminally lazy.
Kozak is assuming 5000 bpd in Q1, ramping to 13,000 bpd in Q4 '09 for an average of ~10,000 bpd in '09. Says CEN will generate $200MM cash flow next year, so he's valuing CEN at 1.3x '09 cash flow assuming significantly lower production than what CEN is guiding...
And what kills me is that even as his '09 target price is based on exit '07 reserves, he gives zero upside for the big likelyhood of CEN increasing reserves next year with additional discoveries at Bua Ban and Songkhla. It's ridiculously lame and lazy analysis.