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Now 193p been falling back all week from last weeks 5 month high of 218p
When money men knew Iran was to attack Is real pushing up oil price .
Deescalation now.
I doubt it the yield is way to high inmv. Personally ten pence for the entire year is my prediction. Inmv we are now starting from scratch as a company in terms of writing off eighty percent of income in taxes..So in other words its where we go from here. Maybe just accumalate cash for the next few years and then take it from there.
Sad really but as a lth i doubt i will see this come to fruition again.
When are the results due here?
And is the dividend expected to be kept at the current level for this year and next year?
IC article 22.02.24
This North Sea energy company is making waves
Investors should take note of this mid-cap's profitable growth strategy
Often when you buy local the trade-off is price. Brits have made their choice for day-to-day shopping, choosing supermarkets over high-street greengrocers. When it comes to oil and gas, however, the local choice is also the cheapest.
Of the UK-listed mid-cap energy companies, Serica Energy (SQZ) is an inexpensive option. The North Sea-focused group sits on a forward enterprise value/Ebitda ratio of less than one times.
Serica returns to shareholders a dividend yield of around 12 per cent. Serica's metrics look so attractive because its share price has fallen by 60 per cent from an August 2022 high of 450p. Even a cash-and-shares deal that doubled production has not been enough to bring shareholders back. The group could be due a rebound, however.
We last put forward Serica as a buy idea in January 2022 in order to hedge against soaring household energy prices. The shares shot up in the months that followed, driven by Russia’s invasion of Ukraine, but since then the government’s windfall tax, combined with weaker energy prices, has knocked its valuation.
Serica’s relatively low enterprise value (EV)/Ebitda ratio is driven by its high cash profits and small pile of debt. Ebitdax (‘x’ being exploration costs) for 2023 is forecast at £401mn. This is a sizeable drop from 2022 due to lower oil and gas prices, but still represents a cash profit margin of 63 per cent. Broker Stifel thinks this margin will climb to 70 per cent in the current year, implying Ebitdax of £612mn. Peel Hunt analysts Werner Riding and Matthew Cooper remain bullish, however. “Despite lowering our numbers, it is important to state that we believe the business remains in a very strong financial position and is funded for all planned work programmes and shareholder distributions.
Much of the appeal of Serica lies in its low operating costs, although these have climbed a third from $16 (£12.70) per boe in 2022 to around $20 per boe now, according to Peel Hunt forecasts. They are expected to stay around that level in the medium term, however, and margins are already ahead of peers'. Gross profit per barrel (or netback) is around $40/boe for 2023, which Stifel forecasts will rise to $49/boe this year. Analyst at Stifel, sees net cash rising from £81.4mn at the end of 2023 to £449mn two years later
Serica’s portfolio offers balance between energy scenarios, but its short- and medium-term prospects are good, and at this yield and valuation we would buy.
https://www.investorschronicle.co.uk/ideas/2024/02/22/this-north-sea-energy-company-is-making-waves/
On this site P/E shows 2.7 % that would be a turn off for many.
Is 5 a good PE ratio?
Very low vs very high PE ratios
It is arguable that a PE of five or less is not a remarkable bargain. While it might look as if the company's prospects are being viewed too negatively, it is not a bad rule of thumb to filter out companies with a PE below this level.
Now 181p.
172p was the low on 4th March 2024 ( 5% lower )
Still category C with broker. ( this not the reason for margin increase this week )
Maybe the category changes are pointers. ( I noted last post the upgrades at same time Gulf Keystone & Marks & Spencer were also down since November 2023 so maybe not )
It was not a good idea staying home and buying more 8th November 2023 for 215p in hindsight.
Copied this from recent poster here .
Which has P/E 4.... 10% div.
Https://www.youtube.com/watch?v=20ZsEzbw7Rs
SQZ get a mention at 14.35 mins, low risk, cheap metrics, great divi and a longer term view.
Down 11% today to 178p not seen that price since September 2021.
Bought back to quickly in September 2023.
Lucky the buy order on 22/11/23 failed at 205p lucky I did not try again 19/1/24 , might of executed.
Gulf Keystone & Marks & Spencer also down since November 2023 so downgrade no clue .
Just noticed this was downgraded for risk from B to C kicked in yesterday reducing my available margin as was GENEL ENERGY C to D .
GULF KEYSTONE was upgraded D to C
As was Marks & Spencer B to A.
Bought another tranche for *215p 10.25am .
Same time as a BP buy a little cheaper then a failed order yesterday there.
Not been spending as much time dealing during summer months , stayed home today .
Time will tell if good idea .
Bought another tranche for 223p
Been a lucky one for me so far .
And a bit of luck today . TYJ .
Had a note to buy more at 230p no stock exchange this morning (D ) when I wanted to buy at 227p
Went strait through when I looked in from the square after playing at 2.45pm.... 5p cheaper.
Luck guy Mr Hardy he did buy at bottom 3p March 2015.
looks like I first bought mid December 2010 at 38.5p HSBC.
2011 I think I recall a rights here , tail swallowed , maybe into ISA , must of looked bad idea four years later.
Lowest buy for me October 2013 at 18p SVS.
It i is all about patience , and staying alive.
Was looking for infor on the largest shareholder here , this article from November 2018.
By CITY & FINANCE REPORTER FOR THE DAILY MAIL
Builder and his wife hit £38m jackpot after picking up an 11% stake in North Sea oil firm Serica when shares were worth pennies in 2015
A builder and his wife have hit the jackpot after investing in a North Sea oil firm whose shares have soared.
David and Debbie Hardy are understood to have spent at least £1million buying an 11.3 per cent stake in Serica Energy.
And their stake was worth about £38million last night after shares closed up another 7.6 per cent, or 9p, at 128p.
Bought Fridays slice back this Tuesday for 240p at 10.30am .
Just a ques an hour earlier , executed wile watching a Mass , maybe as good as watching a chart .
The spread only 0.75% above been lucky trading a small potion of holding , the low just after 237.8p
Only the big boys know what the RNS will be in advance of them .
Mommur
Replied to my slice part of below .
Well done for buying in July Ripley - nothing wrong with taking a profit, although with the present macro's and interim results next week and another possible dividend payment - you have sold into possibly forthcoming good news.
Hats off to you - nice trade.
Thank God I ignored the noise on here , today's rns sent share down 8%.
Sold 6th July top up of 205p for 270p yesterday Friday 1pm
Topped up 205p.
Since my last look at this mid March when around 209p , a clime back to 250p mid June.
Sqz & Kist will be easily picked off - it’s happening!
The offer from Kist should of been driven through by shareholders, unfortunately mitch and his gang had other ideas!
SHAME. SHAME. SHAME!
upomega,
Yep, always an option for them : "company will be sold off quite quickly....around the three pounds mark"
If so, cumulative of the two deals would see Mercuria better off, circa ~£638m
With SQZ's newly acquired tax losses there is a chance several NS players could see this as a very good deal for them. Although that would certainly be seen by current SH as being s c r e w e d over by Mitch 'n' Co if 300p was the deal. More accurate valuation for newly combined group with ~94mmboe + CoH + debt + 40-47kboepd would be around £1.9bn or circa ~500p/s, giving Mercuira cumulative return of ~£832m for TW. Nice to dream !!!! zzzzZZZZZzzzzZZZZ
aimo & dyor
Inmo ,I still think that once the deal has completed the company will be sold off quite quickly. Especially at level we are now trading at . Mercuria/Tailwind would still come away with a nice premium if sold around the three pounds mark.
Nothing that causes the board's and Mitch's services to be no longer required (i.e. a takeover) will be entertained. They will not let go of their jobs and salaries. They have no skin in the game and therefore they will fight tooth and nail against anything like that.
That sounds like an attractive option. Certainly more attractive than where we are at present. Let's hope there are interested parties watching this closely.
Pulling the deal would force the market to assign CoH to our SP as we are sat currently at or around negative EV. We can then put ourselves up for sale on the same metics used by our board offered to TW…. Should easily be in excess of 400p/s in that case .
Aimo & dyor
The tailwind deal had a number of conditions that had to be satisfied. The most significant being the continued availability of the tailwind RBL facility which are now being cut across the sector. The reduction in this facility would give Serica the ability to walk away from this crazy deal. The value of cash today relative to 2P reserves has switched massively in favour of Cash.
Will Serica Board have the balls to walk away if Tailwinds facilities are cut - I doubt it.
The market continues to express its view of the Tailwind deal. Is a hostile takeover too late?