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CF Energy Corp V.CFY

Alternate Symbol(s):  CGFEF

CF Energy Corp. is a Canadian integrated energy provider and natural gas distribution company (or natural gas utility) in the People's Republic of China (PRC). The Company is involved in natural gas distribution and sustainable energy utilization, serving residential, commercial and industrial users as well as electric vehicle (EV) battery swap service in the PRC. Its segments include gas distribution utility, integrated smart energy and smart mobility. The gas distribution utility segment comprises natural gas transmission and sales, including pipeline natural gas sales and liquified natural gas supply distribution sales and related service pipeline installation and connection sub-segments; compressed natural gas vehicle refueling station, and natural gas direct transmission. It provides an integrated smart energy system and an integrated district energy distribution service. The smart mobility segment operates EV battery swap stations, and trades EV to designated customers.


TSXV:CFY - Post by User

Comment by TickBombon Feb 08, 2021 10:48am
255 Views
Post# 32500284

RE:PE/R of 4. Why?

RE:PE/R of 4. Why?So  there are a number of reasons:

1.  Canada's Venture exchange is the black hole of investing.
2.  Unless you're a tech company valuations suck
3.  Energy has been hit hard
4.  There was some recent drama with the old CEO's estate after he passed between his children
5.  This thing is illiquid
6.  Too small for the big funds to invest in any meaningful way.
7.  China, like you said
8.  The have spent the last 3 years repositioning themselves out of some assets to support their integrated energy projects.  Those projects haven't made any revenues yet.  So people are somewhat impatient or are in a wait and see state.
9.  They were impacted from Covid to a certain extent since some of their assets are in vacation destinations (i.e. Hainan)
10.  There appears to be some margin pressure in their regulated natural gas businesses.

Obviously there are tail winds now with ESG, specifically clean energy.  CFY's integrated energy and vehicle batter swap stations should align with this.  But again the problem is that the market cap is simply too small for any meaningful funds to get in.  CFY was going to dual list in the HKSE, but that was put on hold as a result of the recent issues in hong kong.  However, I believe management is in talks with some ESG funds etc.  

In any event, you just simply have to wait and wait for the energy projects to come online.  If they got EPS to over 0.20 in the next two years, I think you would see some action.  It's been painful for all investors.  I know some specifically have had a big stake since the origional IPO at 0.60/share.  Now I think we can all agree that the net value of the assets in CFY are probably worth over $1.50/share, not including any of the new integrated energy projects or battery swap stations. 

But with these micros, it's very binary.  You sit for years undervalued, maybe get some traction for a couple months, then drop back down down.  I think CFY is a long term compounder, so eventually the valuation will go up fast.  But it's painful to wait for sure.
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