Some Context for $20 price target I have been in this stock a long time so I have some history about its relative valuation. As recently as late 2018 this stock was trading at over a dollar or $7 pre split. At the time Baytex was trading at around $3 ATH about a dollar and CPG at around $5. All these companies fundamentals are much better than they were in late 2018 but the reverse split has caused more technical damage for OBE's stock price as on a relative basis they have lagged. If we held our relative positions to these stocks we would be trading closer to between $8-11. Don't be too keen to sell this rally. The price is simply adjusting to relative value which is still much higher.
Targets just came out for CPG in the 12-14 area which for us translates to about $20 which seems unrealistic and yet in early 2017, the stock was at about $2.80 or almost $20 pre split. Comparing us to the fundamentals at that time favours the current company greatly. We produce much more cash than at that time, our costs are much lower and our production is much higher margin.
There are headwinds today with being an out of favour sector but do not limit your expectations of the stock price based on the recent past. I believe this stock is still a solid triple from here, something we may see in 12-18 months time. Don't sell too quickly.