RE:Kicking the tiresMustangMatt wrote: I'm kicking the tires on Surge. Owned before but it's been years.
Is net debt $461 million.
annual cash flow $160 million
are we looking at 2.9 times debt to cash flow?
(Debt is a problem here.)
Looks like Surge is more leveraged to oil prices. free cash flow starts to look good at $65 WTI payout drops to 70% and $68 million in free cash flow, as per the November presentation.
Canadian insider had 9 million more shorts on the name from November 1 to November 30. Could it be the trade is short Surge and tax loss sell it, Buy other less levered names WCP, TOG etc. If this is so, when tax loss selling ends coudn't we see short covering and the trade reverse? Cheers Matthew
Matt, you bring up a very good point about the short position! But please allow me to clarify as I too missed this very important piece of info. The short position increased by 9 million shares over the last
two weeks of November to 19 million.
So, if the increased short position of around 9 million is an organized attempt to suspress the share price before a buyout, it is a smart move as we are only talking about an extra $10 million cost in acquiring the company, if it is bought out @ around $2 a share!
Kherson