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Cohen & Steers Tax-Adv Pref Secs and Inc Fund V.PTA


Primary Symbol: PTA

The Funds primary investment objective is high current income. The Funds secondary investment objective is capital appreciation The Fund seeks to achieve its investment objectives by investing at least 80% of its managed assets (i.e., net assets plus assets obtained through leverage) in a portfolio of preferred and other income securities issued by U.S. and non-U.S. companies, which may be either exchange-traded or available over-the-counter. In pursuing its investment objectives, the Fund seeks to achieve favorable after-tax returns for its shareholders by seeking to minimize the U.S. federal income tax consequences on income generated by the Fund. There can be no assurance that the Fund will achieve its investment objectives.


NYSE:PTA - Post by User

Post by dallytaylor24on Apr 11, 2014 9:06pm
313 Views
Post# 22442680

PTA is in the Crosshairs

PTA is in the CrosshairsPTA is poised to be taken out by one of the bigger producers in Colombia. Especially the ones trading at a premium...which would be all of them....Parex, Pacific, Canacol, Gran Tierra, Amerisur, Geopark, just to name the most likely candidates. These companies could offer a significant premium and the transaction would still be accretive them, which makes me think PTA is in someones crosshairs right now.

PTAs share price continues to drift and their cash on their balance sheet continues to build...this is a recipe for a take out, and it might not be friendly. If it isn't friendly we as shareholders will win because takeout premiums are typically in the 40% to 50% range on hostiles.

That said, I've also heard that PTA may be considering announcing their are considering strategic alternatives, if they did, that would be a nice shot in the arm for shareholders.

Regardless, I think the maybe best outcome would be for PTA to grow their business with an acquisition. The team took a hodge podge of assets and through creative deal making are now producing over 6,000 bbls a day and cash flowing of $100 million this year, and another Las Maracas is just one well away. They have the balancesheet to do some interesting this, just need to pull the trigure on something, investors are becoming impatiant.

PTAs valuation is a total joke right now. Based on Cash flow of $100 million that is $0.17 per share (based on 590 shares outstanding), so at a price of $0.28 per share that is a multiple of 1.65x P/CF...which is unheard of. Also, we have an asset value of $206 million (2P net present value discounted at 10%) plus $95 million cash as at March 1, 2014 less $35 million debt = $266 million for a net asset value, which is $0.45/share. At $0.28/share PTA is trading at 62% of its 2P NAV...which is also amazing...since its peers are all trading a 100% or more of their 2P NAV. If PTA is sold it definitely won't be less than $0.45/share. 

Just my thoughts and rants

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