RE:Transcript from Seeking AlphaI also took time to read the transcript. Thanks for posting it.
Two thing you won't see in it that might explain a big part of why the stock is so depreciated.
The macro factor. The Natural gas industry as a whole is depreciated. For example, just look how cheap Tourmaline is when analysing their statements. Other energy companies are trading at similar levels.
The Peyto factor. Way too much expensive hedges. Peyto had a lot of success with their hedging program in the past. They are programmed to repeated it and today, this hedge book is costing dear. Hedging a part of production makes sense. But hedging 80% in an environment where Nat Gas prices raise, it kills the pupose. Maybe aiming for a lower percentage would reduce the risk.
Impact? If a fund wants to invest in the Natgas industry to gain some exposure to its risks/reward profile, the last place it would go is in Peyto. Why? By selling all its production in advance, Peyto reduces this risk/reward to a minimum. When investing in Peyto's future cash flows, you invest more in the like of the fixe income / bank industry with a little upside to the long term price of NatGas.
Funds attracted to fixe income are quite sensitive to leverage and will shy away. P/e ratio will stay low compare to companies in other industries having different risk/reward profiles.
Peyto's attractiveness should improve in 2022 if Darren Gee can deliver on the debt issue.
Also, during the year, hedges' negative impact will be greatly reduced and the time left before Kitimat becomes operational will continue to diminish.
There is a lot of positive in here but patience is required...