RE: Target Pice $ 51 per share..on LFDHello Everyone,
EOIM you are complicating the issue. The scotiabank analyst gave his report on Niko while the asset is still at risk. It is not my analysis, but rather the analysis of a reputed analyst with a big bank.
Niko holds 37% of PSC contract and, LFD holds 40%. The report applies to LFD since it is in the same position.
The net asset value is calculated with a simple formula:
$ 5 per barrel of oil * amount of recovery oil in place.
LFD stated that it has a 50% chance of recovering 338 million barrels of oil from 1.2 billion in the ground. There is also a 10% chance that LFD finds 4 billion barrels of oil in the ground.
Multiplying 338 million barrels of oil * $ 5 per barrel gives asset value of $ 1.69 billion to LFD. LFD is trading at a mere $ 40 million market cap, pretty ridiculous when you come to think of it.
If LFD hits its 4 billion barrels of oil, of which then LFD is a $ 51 per share stock.
I am of the opinion that LFD should trade at risk up to $ 4 per share. When unrisked, we go double digits.
I understand your position EOIM, but you are refuting the wrong person. You need to go to the Scotiabank analyst and refute his report.
No wonder SOROS loaded up.
I just heard that Gadafi has agreed to a truce, this will stablize the area, so investors will come flocking back.
I predict that in May and June 2011 we will rally pretty hard with LFD, they are no fools, they want the price over $ 1 per share before July 7, 2011 so that they can get the 75 cent warrants exercised. It is big money for them.
Notice how good40 is silent on this board, I guess he is too busy chipping away on the VST board.
Good night,
JMHO