RE:POU's - NVA InvestmentI wonder if at the right time the 2 companies would work together to sell the shares to NVA to retire them. Any thoughts HoneyPot?
MyHoneyPot wrote: NVA was a company that traded at March 18, 2020 for 25 cents. Today it is trading for $8.30, the management at a time when the banks were pulling back on the industry bought 40 million shares, and the last bunch were around 60 cents.
I am not here to encourage you to buy NVA stock because as a share holder in POU you already have between to (1/4 - 1/3) a NVA share included in your POU share value.
NVA will be ahead of the curve, and there are companies with $12 price targets on NVA, and i can see why. They really have done a great job of getting out from underneath the banks, and their debt is just melting away. Once they meet their debt target and get a rerating this stock is well managed and the perfomance has been great.
However POU has a chest of these little treasures, and the monetization of these shares will be done at the right time. With oil trading at 88 dollars and NVA being a significant condensate producer they wells are paying out in no time. Pipestone wells in some cases have flush production of 60% condensate, and corporately NVA is 30 percent condensate.
NVA is now over the debt hurdle, and my guess is in Q1 they will acheive their debt target and if they paying down their bank debt from 197 million in Q4 to 130 million in Q1. I think they will take another 70 million off the bank debt, and will net debt of 350 million exceeding their target.
All this is because i can see NVA at 10-12 dollars and this could result in POU have no bank debt when it decides to sell the shares.
With not debt and only 140 million shares POU is a cash cow, and i expect special dividends will start coming in 2022.
IMHO