Gamehost Inc T.GH

Mr. Market is not feeling well today

[Thelongview]

Well folks, Mr. Market is having another one of his manic depressive days. This time he is only seeing bad times ahead. 

What are the positives for GH shareholders?

1. Oil prices will be at sustainably high levels for years to come.
2. High oil prices will lead to higher salaries for those workers, leading to higher disposable income, leading to increased spending in the local economies, leading to higher casino revenues
3. More tech jobs (that are high salary jobs), again leading to higher disposable income, again leading to increased spending in the local economies, again leading to higher casino revenues.
4. Over the next 25 years the population growth of Calgary will grow the fastest out of all cities in Alberta. The second fastest growing city will be Grande Prairie . Fort McMurray will be the 7th fastest growing city. But will it? If oil prices are sustainably higher, Fort McMurray will likey grow faster. Where are our casinos? Calgary, Grande Prairie and Fort McMurray.
5. The pandemic will eventually become and endemic. We are getting closer and closer every day to normalcy. I don't want to bore GH shareholders with science but science dictates that over time COVID will become weaker not stronger. Why? Because the virus does not want to die. It wants to live and so it does not want to kill its host.
6. GH has very good management that has proven itself in all kinds of economic climates and has done very well.
7. GH has a strong balance sheet.
8. GH is buying back stock well below intrinsic value (think of it as buying $1.00 for $0.55 - $0.63. If you do this often enough you get rich. If GH does this often enough, shareholders get rich.
9. I estimate intrinsic value to be between $11.50 - $13.15.

What are the negatives?

1. The stock is trading anywhere from 37% and 45% below estimated intrinsic value.
2. The stock is down today.

Oh wait. Those are positives also.

P.S. A big thank you to Mr. Market because he allowed me to pick up some shares today a $7.26 today. 

GH shareholders will be well rewarded down the road.

If anybody is interested in how I derived my intrinsic value estimate let me know and I'll write a post on it.

[malx1]

Thank you for this post, TLV!! Beautiful. I've had an unusual feeling in my stomach the past few weeks.  Had a few conversations about "risk assets" and growth stocks being priced for economic growth far above where the mallards fly. Much of the inflation you see around us is the product of ZIRP combined with feverish greed.  (zero interest rate policy) Money has been

[malx1]

Shoot, added an extra decade in there.  GH has got the 20yr badge of operations on its vest.  Pandemic has got my decades mixed with years now! Nukester, don't shoot!

[Thelongview]

Wonderful post Malx! I couldn't agree with you more on all points. I hope readers go over this post because it is the right reasoning in my view. It's when the tide goes out that you see who has been skinny dipping. The imminent rise in interest rates (January 26 hike by BOC? Possible but by the March 2nd meeting for sure) is revealing just how many people forgot their trunks. The