Athabasca Oil Corp T.ATH

A few things to consider...

[masfortuna]

#1  Nuttal DID NOT SELL last Friday just before he was on BNN. After we hit that $1.56 year high we dropped about 20% and traded in a range.  That's when he sold.  When he said he sold on Friday, many followed and sold.  Anybody think that he started rebuying after it dropped to $1.18??? YUP!

#2 To the poster who declared  hedges off end of 2023:  Last hedge gone in 10 months and NOT END OF 2023. I hope it was a mistake/typo and that you were not intentionally trying to mislead individuals.

#3 Finally ATH is notorious for not releasing any info/prs.  Yet they release a proxy q4 and mention the tax credits a number of times in the release.  Assuming you know that banks won't lend you cash to drill more wells, would you not think that taking out ATH at these levels would make sense instead? If they paid $5, the tax credit pays for the company.  You basically get it for free.  So I am in the "YES" camp for a possible takeover in the near future.

#4 In the last 2 weeks I have been adding to my position after selling OBE (125% increase in 4 weeks!!!) and that drop last Friday gave me the opportunity to triple my share count. It was a good day ;)

[ManitobaCanuck]

 Agree with everything but the 5$ takeout price seems a little high to me . 

[masfortuna]

It won't be come June ;)

[masfortuna]

Manitoba if my math is correct a company buying ath would not pay any taxes on that first  3.2 billion in revs. Assuming a 30% saving (???) that's  about 1 billion in savings and would account for a $2.15  sp alone. Pay and additional $2.85  per share (for a total of 1.7 billion) and that gives me $5 dollars.  So  a company making revenues in excess of 3.2 billion

[ManitobaCanuck]

Mas my friend, agree with your math. But isnt the share count 550mill. Secondly tax losses are about 1.2$ a stock. I would value this at around 30k per flowing barrel( similar to what CNRL paid for Storm) Thats about 2$ a stock plus 1.2$ tax losses=3.2$ . Even if we discount 20% ,we may get 2.5$ a stock...Will be happy with that offer too

[Maxmoe]

There's lots of numbers we can conjure up. In the release they purposely mentioned FREE cash flow of 900 million. That's $1.70 per share. That can be used to self finance a big part of a bid. Now, since they will still have multi decades of reserves, I could add your asset and tax value of 3.20. Let's call it 3.30 for shiggles and BAM, there is the magical mas number of $5. So long as

[masfortuna]

Nice font Max on your previous post. Yes I am a little confused with some of the numbers such as the amount of fcf.  I think the number may be what they would have AFTER they make a debt payment (???). 85 million sounded really low. So not sure EXACTLY what the company is worth because we have a lot of moving parts and the biggest would be the price of oil.  Oil breaks $100 would change

[ComradeKomissar]

$5 is not a dream. My metric is 8 x Free Cash flow, and at $80 WTI we should be already there ($5.46). At $100 we should be valued roughly $10. This is gross of hedges. The real question is, will anyone buy a shitco at 8 x FCF       FREE CASH FLOW        OIL Price

[masfortuna]

Ok thx mate. looking at your numbers, they do look correct. 

[masfortuna]

Ok thx Manitoba. Not sure why you calculated $1.2 a share x 550 million = $700 million. I would think the 3.2 billion in tax credit would be worth more than 700 million? Anyhow $5 is my really really really high expectattion so I too would be happy with $2,50.

[Maxmoe]

It's worth a portion of the top corporate tax rate in Alberta, whatever that is. Probably less than 700 mill. Gotta leave some meat on the bone and account for possible changes in tax laws in the future. $2.50 sounds like a nice opening bid to me too mas! Then it's game on.

[ManitobaCanuck]

Hi MasFortuna    I believe as I understand you dont get full value of thise taxpools . You get 30% of 2.1 billion= 700million.

[NWOntario]

Correct, think about it this way, if you were a profitable company with no historical losses, how much tax would you pay on 3.2 billion in profit for the quarter or year depending how big the company is, you take the high corporate tax rate for Alberta since it's not a small business, so 3.2 billion x approx 30 percent and that's the tax you would pay to the CRA.  The company that

[masfortuna]

Ok thx.  I thought it is 3.2 billion and AFTER the 32% tax, it is worth 2.1 billion.  Maybe I am wrong. 

[Maxmoe]

Mas, your point 3 really stood out to me when I read that press release. From ceo. I'm loving the big headline numbers. 900 million in FREE cashflow over next 3 years. That’s $1.70 per share. And they will still have multi decades of reserves and billions in tax credits. Those are tough fundamentals to beat and. VERY uncharacteristic of them to release a press release of this nature. It’s

[Maxmoe]

It reads to me like "please don't let the bad man buy your company at a huge profit because we will all get the boot!! Waaah!, "

[cahclick]

Im just pulling this outa me butt. As you know I was wondering yesterday a.m. also why would ATH drop the Q4 bomb. You know, there is the outside chance that ATH management are pizzed at the shorts too and knew that dropping the Q4 bomb would likely burn them good. jmo glta

[Maxmoe]

ShoRt report is out for Jan. Small decline in shorts. So, yup, their pants are on fire. It happens.