Post by
Margin321 on Feb 26, 2021 2:55pm
Results okay
Did pretty well in tough year. Have excuses for slight drop in Q4.
But the report was not well written or organized. And they don't do a conference call. Financial reporting should be consistent and predictable and transparent.
The bottom line 23% decline rate. They can make 70 million in free cash flow after enough investment for modest growth of about 5%. Though they have some upcoming expenses for facility upgrades.
After this report I have not changed my mind that AVE is undervallued and worth investing in as a small cap value holding. There is not any near term major growth in the plans.
The problem for the shale wells is that you have to keep drilling more every year to keep prodcution steady. And gas is pretty available and any major uptick in oil drilling (driven by higher oil prices) will produce more gas.
That is why I am more upbeat about TXP right now (despite WC past and I am sure continuing assertion that there is no market for the gas in Trinidad - a claim that persisted even after they signed a 30- year contract to sell all the gas they can produce). The nice thing there is that they have found conventional reservoirs where you can drain a sizable reservoir with 5 vertical well bores and there is no need to drill additional wells for the 10-20 year (or more) producing life of the discovery.
Anyway, pretty brutal last few days overall, certainly in the shares I hold.
I don't know if you saw the blurb on Yahoo Finace where someone is advocating investing the $1400 stimulus checks in stocks like gamestock aiming to get a 10 fold return in a few months. Good luck.
Comment by
Wildcattter on Mar 01, 2021 10:32am
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