DividendsIt seems as though Monkey_Spanks has you this time Ferret!
I was looking for some responses in the papers and other media this morning and from trading houses regarding any new opinions about our company. I thought other readers of this board might find this interesting.
Cenkos analyst Ashley Kelty points out that the A1 flows exceeded previous tests on the field, and that the well was completed on budget.
The well result is hugely positive, he says, explaining that Ithaca’s achievements are ‘arguably rare’ in the sector.
“This is an important development milestone, and we are greatly encouraged by the result and timing of the well, with the resultant look-through to the performance of the full field from 2014,” the analyst said in a note.
He adds: “In our view, Ithaca offers an attractive entry point to the E&P sector as a cash generative company with material production, low risk developments and exploration upside from multiple prospects.
“With the positive news on the transformational GSA development highlighting the significant value for Ithaca to be realised from 2014, we believe that the negative sentiment towards the sector is due to end, and anticipate that Ithaca shares may appreciate to a level in line with peers.”
VSA Capital, meanwhile, goes further, saying it is difficult to see another stock of a similar size with quite so much potential upside as Ithaca.
“The company is now a mid-sized producer (12-14,000boe/d) in the North Sea, following its acquisition of Valiant Petroleum, and will see production increase to more than 25,000boe/d in mid-2014,” analyst Dougie Youngson said.
“The portfolio also includes significant exploration potential, which could yield more upside.
“Ithaca will have US$500mln of debt and the company expects to repay this within 12 months. Ithaca will at that point be highly cash generative and the free cash flow could be used to make more acquisitions or it could pay a substantial dividend which the management has guided could begin in 2015.”
I love the fact that this analyst uses the term "arguably rare" when describing the results from this new well!