Canyon continues big rallyFRC.to +.21 to C$7.35. Up $1.50 since my last post of 9/14 so +25% in 3 weeks. I think this is in anticipation of a nice Q3 as well as catchup to the p/e multiples of the bigger players TCW and CFW. The wet weather and increased share count may make it difficult to match Q1 but we should certainly move into the mid teens in eps. I think .15 to .18 eps is achievable and Q4 should be stronger. Continuing low gas prices worry me a bit as Horn River and Montney wells mandate much bigger frac equipment and represent a big growth area for Canyon. However most of the players in those two areas are very big companies. And I think they expect the construction of a export LNG plant in BC in the next several years that will open a market for Canadian gas in Asia.
My personal prediction is over C$20 for FRC by late 2011. We will receive additional pumping equipment by late this year that will increase HHP to 125,000. FRC started 2010 at the increased rate of 50,000HHP. So continued increases in gross revs and net should be the norm.