Post by
bplondon on Aug 12, 2015 8:27pm
Earnings out after the bell tomorrow.....
I spoke with Dean Bernhard about a week ago and he said he felt "very comfortable" with street concensus of cash flow at 23 cents a share.
That leads me to believe it may be in the 25-26 cents a share area-anything approaching 30 and I I'd be ecstatic but I'm not expecting that. Just a solid quarter reflecting smart management in difficult times. Probably indicative of cash flow for 2015 in the 80-90 cent range, which in normal times would be good for 5X multiple and a share price of $4-$4.50. Unfortunately we're not in normal times.
I don't expect big things from the share price in the immediate future-the sentiment is just too negative on oil stocks generally and RMP specifically, not that I fully understand why. If the numbers I've posted above are achieved I'll continue to be bewildered and hold for the longer term as the plan unfolds and (hopefully at some point) oil prices move higher.
That's going to take some time, months at least, possibly a year or two, not weeks and my view at this stage is that the big money will be made on this stock by longer term investors and not short term traders.
When I spoke with Mr. Bernhard he seemed to be very pleased with the slick water frack results at Waskahigan ("very pleased" might be an understatement); if they can replicate those kind of results with waterflooding at Ante Creek starting at some point in 2016 which coincides with a rise in the oil price as well as any positive developments from the new land position this stock will have a long way to run and could do it very quickly.
But it ain't going to happen overnight (as much as I'd like it to) ;)