RE:RE:RE:SAGD Warm Up PhaseYou know investors keep pointing to the price of oil and the previous share price of CJ like the two should be inextricably connected without any other factors coming into play.
Sure the last time WTI was at $84 CJ was over $7. But debt was also less too.
As you add debt to a company it becomes worth less per share. So if oil pricing isn't enough to cover cap-ex and the divi and they use credit to cover the shortfall you will see the share price dip accordingly.
Now if the oil price rises to a point where we see cap-ex and the divi being covered and maybe some debt being paid down we can expect the share price to rise. But not really until then.
So no, I don't think anyone is holding CJs price down but maybe SCR is waiting for the opportune moment when its share price is trading high and CJs is trading low to take it out with an offer that will seem good to their shareholders and CJ's at the time. With everything ramping up and the SAGD project derisking more every day sooner rather than later seems appropriate. Maybe.
GLTY and all
CJInvestor wrote: Could a potential buyout suitor be artificially keeping our price down? Oil up 13 percent over the last month and we are down 5? It's just beyond a head scratcher that we are so depressed with oil well above 80. My fear is when oil dips to the 70s we will decline more than we have risen this period of inflated oil prices bringing us to the 5s and making this not my finest investment decision.