RE:RE:RE:RE:RE:Buy or wait?Yes, great points. MEG is severly undervalued, especially when I think of it's place in the future where oil supply is scarce as we reach maximum supply.
I watched that video link as well, good info.
Yes there will be EVs, but for a long while, they will be an addition to the vehicle mix, and not entirely replacing ICE for a while, especially on a global scale.
I'm licking my wounds from the last couple of days price action, and repositioning. Herd mentality is strong, and you can't fight the market when it wants to go down. It sometimes make no sense, but in the end fundamentals win. Hang on, as all things point to a bullish market in a few months.
MaximusGainus wrote: Re MEG, and many other oil stocks, they are being severely discounted. For companies with decades of reserves, with reasonable debt, low costs, and in a normal priced oil market, the multiples should be at least 3x as much as they are now, using many different ways and valuation calculations. Yet the market thinks the end of the world is coming for oil in 3 years, and these companies are priced only that long, with multiples of giant industrial companies trading at like 3 x FCF and lower.
Here's one good example arriving at such a $60 valuation for MEG at $100 oil.
Unfortunately we do not have a normal functioning market. Although physically and fundamentally we should be flying, it is being pecked to pieces by this flock of black swans like the pandemic, war, recession fears, inflation, oil going negative, ESG influences, Trudope, idiot Democrats, etc.
https://www.youtube.com/watch?v=tMR5lkmCt2k&t=151s Obscure1 wrote: Great comments guys as usual.
Migraine: You mentioned that MEG should be a $60 stock in a normal market. What is a normal market? Why is MEG trading at 25% of $60? These are honest questions?
I can look at the anticipated new Tesla production numbers for Giga Shanghai at 4,000 vehicles per week (insane) beginning next week and do the math. I can build in their Freemont production and the anticipated ramp up of Giga Austin and Giga Berlin as long as demand remains intact. I can also build in how their production costs are now plummeting to forecast future profitablity. From there, Tesla gets really complex as the street obviously doesn't have a clue how to price in the present value of future cash flows from FSD, insurance (Tesla will be the biggest auto insurance company in the world in the near future), Super Charging (Tesla is already the biggest in the world and is hasn't even begun to get started yet), Cyber Truck, Robotaxi and all of that combined will pale in comparison to their AI dividision is and when they get Optimus up and going (we will get an update on September 30th on AI day).
This is a SU thread, not a TSLA thread, so I'm just using TSLA as a base of comparing its complexity to what appears to be an incredibly simple set of metrics for Suncor. SU mines and upgrades oil, refines it, and sells it. Pretty simple stuff in terms of analysing the production aspect. We know the fixed and variable costs so the only real question is the impact of the price of a barrel of oil.
Figuring out a realistic share price for SU should be as simple as creating a spread sheet (I like the one from the guy at Royal Bank that somebody here updates). It can't be that difficult to model what the price of SU should be based upon the price of a barrel of oil and the crack spreads by applying a historical beta.
Why has nobody done this? If it doesn't exist, why not?
I'm trying to figure out whether to add another 5k shares this afternoon. Every oil company Q2 report I have seen so far (even the OXY numbers that appeared as a miss in the headlines where a huge beat if you dig a little deeper) have been stunning and no adverse operating events were reported by SU during Q2. The answer should be simple but absolutely bloody nothing about SU makes sense to me.