Nuvista Energy Ltd T.NVA

My simple view

[alertmeipp]

So the plan is to grow to 80k boe/d in 2023, assumg they trade around 25k boe/d then and have around 400MM debt left.

Equity value should be 1.6B, divided by 226M shares. $7 per share.

Pretty good return for 2 years. Obviously, we will need > $55 oil price.

[Investnowplease]

Well imho 75$ WTI and 3$ Gas which i believe is a min for the next year, if you look at cask flow that should increase cashflow by my estimates by 175m -200m. Assume they pay down debt by 100m a year for two years that put debt at 200m.  Then take 70000 boe @ 30000 flow value due to wti prices minus 200m = 1.9B that makes a share price value at 8.4$.  Pipe dream i know. So yes a

[Oldnagger]

Let's get back to basics, then you can decide if you are dreaming or not. Normally stocks should be trading at a P/ E ratio that is the same as their long term average growth rate. For NVA that would be somewhere between 30 and 40 times.earnings (or FCF) maybe because of inherent risk or share price volatility the P/E ratio shoulld be a bit lower. OTH due to current extremely low long term

[Investnowplease]

I agree totally with you. That is however one way of an evaluation.  We both agree that NVA is seriously undervalued and will always be. Thats an issue. Someone whomever that is should take advantage of that

[Oldnagger]

In my rather extensive investing experience dating back to 1958, undervalued stocks nearly always get taken over by someone. It usually doesn't take too long, I do not share your opinion of management, I hold them in high regard, thus I believe the premium could be substantial. OTOH the world has changed so much that I really should be very careful in predicting anything !!

[LittleYerry]

I'm glad I have you on my team Oldnagger. I think I'm lucky to have started my investing career at a great time. I think it's a one in a lifetime opportunity as well.

[Oldnagger]

It seems I have scewed up my evaluation. As long as WTI remains above USD 55, then NVA will make at least a 100% rate of return on drilling wells . With this in mind, the P/FCF ratio should be 100. Based on Q1 annualized that equates to a share value of $60

[alertmeipp]

NVA's management is not bad. I think they were doing quite well until oil price tanks again right after they acquired CVE's pipestone. Not many names out there can growth 60% at half cycle cost ... without spending much in infrastructure.

[Sugaree]

Yes, management is fine, anyone who sputters anything different is a useless talking head, including nonother than Honeypoo.