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Thank you for the info ROS1
Just to add to that... looking at the daily volume, it's hard to see how all the 31m CB shares have been washed through the market yet... I would say maybe 6m on the 6th, and 1-2m per day since.... I would guess around 18-20m sold... perhaps we have around another week or so for them to clear, maybe then some of the shorts will close and every 1p rise wont get sold into. Can only guess and make assumptions on something like this, but it follows the share price action and some of the block sells going through.
Thanks to ROS1 and Sharelock for some very well thought out and informative posts. I agree H2 is looking very exciting indeed. I've had a little bit of a mental wobble with PMO lately. I still think 2018 will be a great year for the company and I think 2019 could actually be even better. On reflection I've come to the conclusion my wobble was caused by being in profit !! I've found when the price drifts it can actually be more stressful compared to when I was underwater. Anyway, my finger is well away from the sell button and looking forward to my PMO paid for New Years Eve party.
I thought it was 65 dollar but could be 60, somewhere around there i guess
Thanks for posting that info ROS1, out of interest , do you know what '$' price is breakeven for PMO?
Problems at the Cat, what you being that on?
I think nearly half way through H2 we can say that we could upgrade the low end range to estimate $350m to $400m
I agree I think the November trading update is key. I believe fundamentals are very strong, but they probably need another 12 months to really strengthen their balance sheet before they meet some investors risk profile.
Another interesting point.... Tullow share price today is pretty close to their SP on 10th July when we were at year high 134. I find it impossible to justify Tullow outperforming PMO
Fact is, the existing business will deliver an excellent set of H2 results, that is easy to work out. Perhaps investors want to see evidence that the debt is reducing, but its clear to see the available cash flow is sufficient to over deliver on their target. H1 results were good, but that is with low impact of Catcher production.
SK i'm not sure <$80 is significant, or should I say I don't think we need to be at $80+.... 2.5x leverage in 9 months time, it can't be underestimated how significant this is down from 5.9 x.... The business plan is based on $65 and achieving the plan will produce excellent performance... exceeding it will be fantastic. For a company of this size, that's a relatively short time period to look at potentially a nice % gain.
I have just run some basic numbers off the financials, I actually can see them getting closer to 2x EBITDA by Q1 2019 rather than 2.5x with oil $75-$80 (assuming debt paid to target but higher EBITDA). $2.65m debt in half year accounts, $0.5bn reduced by March 19 assuming $400k achieved by year end and allowing $0.1m for Q1. EBITDA for H1 was $389m with production at 76k boepd... with full year forecast at 80-85k with July averaging 86k, thats an extra minimum $140m revenue in H2 or another $100m on to H1 EBITDA (based on a cautious $75 average), so lets say they achieve full year Ebitda of $900m, thats 2.3 ratio. I think they will over deliver on debt reduction this year personally, as the opportunity appears to be there, depending on if they decide to invest elsewhere. P/E ratio transformed, EPS transformed, I estimate book value of $1bn by 31 Dec 2018 based on above - it was $764m H1, which I would say can support a share price of £1.60, certainly £1.50 minimum based on similar multipliers, without taking into account lower leverage = less risk = higher multiplier.
Whatever the market is doing at the moment, it feels like quite a safe investment at this level IMO.
SK - beat me to it...
Was about to post this link.
https://uk.finance.yahoo.com/news/mexicos-next-government-starts-oil-195837977.html
for the risk averse...
But how much is it worth on the SP today?
Surely this can only be continued block selling by convertible bondholders pulling this back? It's lagging behind where it should be on POO and lagging behind other oilers... it has to catch up at some point, the free cash flow at POO in high 70's just cannot be ignored in terms of the acceleration of debt payback and in tern reduced risk and increased earnings multiplier.
I think I am going to have to stop watching this share as it is so irrational.....hardly peaked given POO and seems to tank the minute POO drops....still holding as no spare cash....it will come good