I think everyone who is a regular on this board knows how highly I regard OBE and the potential this company has. I believe it could be $20-25 by year end. In the past though when I have spotted relative better values I hav spoken up about them and ended up making quite a bit of money. I did that with IPO early last year and bought a bunch when IPO was about 1/5 of OBE and sold OBE to finance it. I later sold all my IPO and bought back OBE when the ratio was 2/5 late last year. That made a lot of money in my accounts.
The most recent relative valuation aberration is YGR to OBE which currently sits at over 5 to 1 OBE to YGR. Traditionally this had been about 2 to 1 and at many points in history had OBE less than YGR. Let's look at the cash generation for comparison.
In 4q YGR had FFO per share of 38 cents per share. Comparing like for like that would be akin to OBE having FFO of almost $2 per share where OBE is likely to make around $1.10-20 per share so as good as OBE fundamentals are, YGR is relatively undervalued by almost half.
What I did yesterday was to sell some of my OBE (as hard as that is) and bought YGR while it still languished in the low $1.80's. I was able to translate at 5.2 YGR shares to every 1 OBE. At some point that ratio is going to snap back. By the way like OBE YGR is lightly hedged and YGR is projecting growth for production of 20% for 2022 compared with 4q 2021 (12,000 bbls per day 2022 vs just over 10,000 in q 4)
I share this with the group as something I am doing because I think YGR is massively mispriced. It may be this year's IPO story. Do your own due diligence.