GREY:CNKEF - Post by User
Post by
templetoothon Jun 13, 2017 3:04pm
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Post# 26357879
Canaccord initiation - 60 c target
Canaccord initiation - 60 c target
Highlights:
1. Two year transformation into pure play Montney, cash on hand, development plan to double production from 3000 to 6000 boe/d at year end and "continued robust growth over the next three years".
2. ..."material discount on all metrics to its small cap Montney peers (LXE, BBI, and RMP) with similar land positions and/or production levels." Trades at $750,000 per section vs. listed peers at approx $2.4 mm.
3. Estimate a "C-NAV" of 64 cents (2P NAV plus risked upside). Conservative assumtions in reaching that estimate by crediting Upper Montney acreage at just 20%, no value given for Middle and Lower Montney potential.
4. Return to drrill bit... production growth...economies of scale....acreage delineation...could lead to significant multiple expansion.
5. While at the end of the pipe in NE BC, has access to and ownership of infrastructure...market has yet to recognize this competitive advantage.
End of Canaccord. Personally, I have trouble trying to understand why one of their private co. neighbours doesn't swoop in to eitherr take CKE private or get a public listing on the cheap.