It appears obvious the market was expecting something quite different than what was announced by equal management.
Their capital budget at $36 is higher $3 million than cash flow estimates which is reall not that uncommon. As a matter of fact, probably 70 of their peers are likely budgeting slightly more capex than cash flow (even oil weighted companies).
NOW would be the right time to do a tender share buyback for Petes sake....not when the commodity prices rebound and the share price is hopefully condsiderably higher.
Evidentally there are shareholders willing to let their shares go for $3.26 today so a Dutch Auction Tender at $3.75 would break the door down with willing investors offering their shares and the company could use the unexpected surplus of money they received from the Royalty streams as well as the Cardium asset sales. with $30 million they could reduce the share float from 35 million shares to 27 million share or even lower.
This is adding shareholder value and taking advantage of the very unfortunately low share prices and use the asset sale proceeds to reduce the share float.
I am upset by today's announcement. I think it may have been a different market response if they had announced a US MLP model with a sizable share buy back tender and a slightly higher dividend.
I was not impressed with the the graph that was in their announcement showing the share price exceeding the S&P since the commencement of the strategic review. They should replot it tonight and it would be a different story.
I don't know if they have fully listened to the shareholders yet.