RE:RE:RE:RE:RE:RE:RE:Akita Drilling Ltd. Price Target Raised to C$3.75/Share
So if we can get back to the “drill baby drill” times then we should see the Akita stock price get back over $7/ share. That would mean going from the current 50% utilization rate of the drilling rigs to over 80% utilization.
If the Xtreme purchase was the main reason for Akita’s low stock price, then what if Akita would not have purchased Xtreme in 2018, considering that PD (Precision Drilling) stock is up 26% since the beginning of 2018. Akita was valued at $7.61/share X 18 million shares o/s = $137M. Akita purchased Xtreme for $211M. So, assuming both Akita and Xtreme did not even increase in value by 26% (like PD), but stayed flat, the total Akita/Xtreme combination, if they would have stayed separate, would be valued at $348M ($137M + $211M) today. Therefore, the value of Akita and Xtreme combined would imply an $8.70 ($348M/40M shares) share price for the 40M shares o/s currently. Again, it really makes no sense how the Akita share price can be so low. It should be at least 4-5X the $1.50 share price, closer to the $8.70 share price. The assets and the earnings would be similar whether Akita and Xtreme were combined or separate.