Post by
mrmomo on Nov 01, 2023 9:10am
As EXPECTED.....
And NO surprises on either side. A solid quarter by Athabasca, all due of course to the more than the average oil prices for the past two years. And i FULLY expect any other producer who is heavily weighted on the oil/crude side, to come out with the same exact earnings report. If i had to nitpick a little, then i would point to revenue being lower than last year, but this is normal due to lower oil prices the year before. And as Tamarack's earnings before them, had echoed the same thing. Also as expected, the company's recent asset sale has increased its cash position to about ~$340M or 0.60 per share. Thier debt position is about the same, coming in at about ~$300M, which more than "acceptable" for a company their size. The question now is what does the comapny do next?
As it's more than obvious, especially after Ath's recent divestiture of their conventional O&G assets, then they're looking for a "exit" strategy to increase s/h value. So whether this mean they're on the block for a possible sale or merger soo or not, i beleive THIS is where ATH is headed eventually. The only questions left in my mind, is HOW does it get there, with WHOM and WHEN? So if a sale does not materialize by year end, i would say one will be VERY probable by mid 2024.
That's the EASY part, the harder part is figuring out WHO would be interested to takeover ATH's assets, as they are quite "dully valued" at this point. And ANY one willing to buyout Athabasca around these levels will be paying not only a very rich price in terms of valuations, but also might have to include a VERY generous premium. And not many Canadian producers, no matter how big they are, are so willing or able to do this.......without issue. But if i HAD to take a wild guess here, MEG & Cenovus, and maybe the lowly Strathcona (if they can get it for a 50% discount lol), look like the most likely suitors to take on ATH's unique but problematic assets and i see NO other.
I'm not a s/h here, but this is getting interesting. So let's see where this goes, as the list of small indepedant Canadian ep's is slowly dwindling down to a few, after the most recent buyouts of Spartan, Repsol & Pipestone. And i'm pretty certain we'll be adding Athabasca to that VIP list quite soon too.......
GLTA
Comment by
riski on Nov 01, 2023 1:52pm
Interesting thoughts again. We will see how this plays out, but there is no doubt that M&A is buzzing in the oil patch on many fronts.