RE:Arctic Securities Bullish on AFE
Good story, with very near term catalysts. Estimated value is probably low, but price is always a discount to value. Interesting their largest position is AFE, but the price is at such a low percentage of value, with value realization very high probability, it is a very low risk play.
Gazania is the kicker. I believe AFE's stake in 11B/12B is too large for them to fund their share of development, so they will sell. If Gazania meets the 300mm boe, I expect them to develop directly. Easy and shallow, it will give them long term cash flow, and cash will be available from sale, with more than enough to also pay a large dividend.
Hopefully !