Saturn Oil & Gas Inc T.SOIL

warrants

[kurt73]

What are the details on the warrants? warrant price and maturity date?

[ROIcrusader]

Two tranches of warrants outstanding, all information available here: https://saturnoil.com/invest/presentations on page 29. I believe the best way to play this name is the June 2023 warrants, which are now at about .04c risky for sure.  A take out over $4 would be interesting given the latent financing in place with the warrants. 

[kurt73]

Thanks. I would agree. Risky but a $4 share price is a 20x on these $3.20 warrants. The stock price has potential to be much higher than 4$

[ROIcrusader]

You're welcome. No doubt there's significant overhang with the 3.20 06/23 (13million) warrants and the $4 2025 warrants (7 million). The biggest challenge for the 2023 warrants will be daily volume. At 3.10 it's are approx 10% below the pricing where arbitraging warrants onto the market becomes profitable. Keep in mind, if excersised in full, the June 2023 warrants will net Saturn

[kurt73]

Great analysis. Do you think the warrants hold the stock price back at all? Or is it totally unrelated?

[ROIcrusader]

Great analysis, maybe lol. Time will tell but if today is any indication we are headed in the right direction. The warrants and share price are definitely related. As the share price crests 3.20 and the warrants move 'into the money' investors will have the chance to arbitrage the warrants. That is, action them, buy the shares, then sell the shares into the market making x amt on the flip

[ManitokFT]

Watch out - pretty sure you need to buy 20 of the SOIL.WT ($3.20 June 2023) warrants to exercise for one share at $3.20. In that case, you need to buy 20 of them at about a nickel, so breakeven stock price is $4.20. It's not a 20 bagger at that point...

[ROIcrusader]

That's ... not how warrants and/or share consolidations work. The original strike price of the warrants were .16, which adjusted to 3.20 (.16x20=3.2) as did the number of warrants which was reduced by a factor of 20, in conjunction with the 20-1 share consolidation. So you do not need to buy 20 to get a warrant on 1 share. Each warrant entitles the holder to a treasury share, expiring

[ManitokFT]

Share consolidation, yes. But it appears that they did not consolidate the warrants. Their reporting is horrific and it is easy to miss. From the Q1 financials (note 9), superscript on the 13.4 million $3.20 warrants: 1 Reflects 268,333,333 warrants outstanding, exercisable on a twenty warrant per exercise basis at a combined price of $3.20 per exercise... If you look at trading volumes on SOIL.WT

[ROIcrusader]

I'll take a moment here to eat some crow. My apologies if I mislead anyone with my ignorance. Previous poster is correct; 20 warrants are necessary to redeem for one share which does impact the returns/breakeven price as @manitokft mentioned. Kinda shady tbh. I feel like I'm too old to be missing this stuff but I guess?! The Company currently has 268,333,333 listed common share purchase

[downtozero]

So if there's no dilution below $4.20, what's keeping this puppy down around the $3 mark?

[kurt73]

This is a great question. Even fully diluted this should be a $7 stock with a 2022 exit of 9000 boe/d. I think the warrants did do a 20 to 1 consolidation looking at the chart back to October 2021. This should have no effect. Just my opinion but as the story gets out and the hedges wear off this is a real opportunity for an easy double