Member Info for Andy144

My takeaway from the last 6 months is this:

1) don't raise equity to purchase assets. It batters the SP and makes you look like Charles Ponzi.

2) if you are going to do 1) buy back the shares you issues at £1.05 if they are at £0.85!

3) if you arn't going to do 2) then pay down debt.

I guess DEC need to issue a really cr@p set of results to get the SP moving North. It's a bit of a mystery really. Absolutely nothing will get the SP moving the right direction.

Once again a total damp squib share price reaction. Topped up today and will restart dividend re-investment.

Trek. Thanks for the info. I looked at the charts you mentioned. I thought the 10 year Nymex assumption a bit toppy but HH does have it at that level 10 years out. Rather depends if DEC can hedge now for that price.

Cheers

I see the decline rate has gone up to 10%

It is the one thing I have stuggled to get a firm grip on. I assume this is an exponential decline (i.e an individual well will decline slower and slower). Also, I assume they must have bought quite a number of newer wells recently for this decline rate to have gone up.

Thanks in advance for any informative responses.

Interim results were usually announced in September. For the last couple of years it has been first half of August. Probably nothing to get too excited about.

"where i come from (people’s republic of scotlandistan, ) btw, the elixir of life, is thought to have magical properties. let’s all drink some tomorrow and maybe the share price will double?"

Is that the People's Democratic Republic (Aberdeenshire) or just the PRS (the rest of it)? I did some charity work in the PDRS too many years ago to count with Halliburton. Unfortunately I had to be medevaced back onto the Ocean Valiant when I caught a dose of Green Monkey Desease after being bitten by a Glasgow goodtime girl I got friendly with after a pint at Filthy McNasty's.

Above said semi-sub is, I believe still afloat and working. My cabin presumably being cordened off and original occupants quarantined.

First post here but a long standing holder.

1) LIT would have known about this potential ruling.

2) Burford has hardly moved at all and it cannot, by it's very nature, only affect smaller funders.

Original-Research: Diversified Energy PLC – von First Berlin Equity Research GmbH

Einstufung von First Berlin Equity Research GmbH zu Diversified Energy PLC

Unternehmen: Diversified Energy PLC ISIN: GB00BYX7JT74

Anlass der Studie: Update Empfehlung: Buy seit: 12.07.2023 Kursziel: GBp180 Kursziel auf Sicht von: 12 months Letzte Ratingänderung: 25.05.2022 (previously: Add) Analyst: Simon Scholes, CFA First Berlin Equity Research has published a research update on Diversified Energy PLC (ISIN: GB00BYX7JT74). Analyst Simon Scholes reiterated his BUY rating and maintained his GBp 180.00 price target.

DEC looks set to be a prime beneficiary of a multi-year LNG-driven gas price rally, which is currently in its early stages, but will likely be sustained for the rest of this decade and beyond. In its Annual Energy Outlook published in March, the U.S. Energy Information Administration forecast U.S. dry gas production to move ahead 2% by 2030 and 15% by 2050 with the LNG export sector the fastest growing part of the market. As an established industry consolidator, and by virtue of its extensive and growing footprint in the 'Central Region' in proximity to the Gulf Coast LNG terminals, we expect DEC to clearly outperform these growth rates. Natural gas pricing has been rising in recent weeks as increased demand for gas in electricity generation and flattening production growth due to reduced drilling have pared swollen spring inventories. Q2/23 was the weakest quarter for NYMEX gas pricing (average of USD2.10/MMBtu) since the pandemic-hit Q2/20, but the NYMEX futures strip shows pricing rallying to an average of USD2.92/MMBtu in H2/23. Growing demand from LNG exporters (incremental capacity of 3.36 bcf/d in 2024 (+23%) and 2.74 bcf/d in 2025 (+15%)) is likely to tighten the market further. The NYMEX futures strip shows pricing of USD3.54/MMBtu and USD3.95/MMBtu in 2024 and 2025 respectively. 85% of DEC's 2023 gas production is hedged at USD3.54/MMBtu (2022: 90% at USD3.24/MMBtu). DEC thus looks set to achieve an adjusted EBITDA margin of ?50% for the sixth year in a row in 2023. The stock's current yield of 15.7% is very attractive, as is the upside potential to our price target of GBp180.

Yes of course. It will directly affect how much you will receive in dividends if you are paid in sterling. In fact, as I have mentioned on this board before, it could be THE defining element of one's investment. The dollar could well be in terminal decline. It's impossible to be certain and only the very brave will bet against the US economy but many countries are now selling their dollars. This will pose an issue as the US keeps on printing them.

Looks like there is a nice (long term) double bottom forming. Needs to get over 96p for momentum upwards.

Used for shale drilling perhaps?

As I didn't have anyone telling me to **** off with the last post on US Economics, I will continue with currency and money:

We are currently living in a monetary experiment. It has been going on for about 15 years now in the form of QE. 15 years in economic terms is a finger snap but in human terms it has almost become the norm and markets in just about everything are now addicted to it. We might now just be starting to see the first thread which, if pulled, will unravel the cloak thrown over our eyes.

There are 3 ways currency is made. Most people call it money but it isn't as it has no long term store of value:

1)Physical printing (a tiny spec - almost insignificant)

2)Digital creation via the Federal reserve and treasury creating it out of thin air.

3)Fractional reserve lending where the banks can loan out 90% + of any deposit given to them to create credit. In this way $100 dollars deposited can become $1000 or more of credit, created out of thin air.

There has been a massive increase in 2 & 3 over the last few years. Nearly all pumped into stocks, cars, wine, houses etc. This has caused rises in all of those assets. It is worth noting that inflation isn't a rise in prices. Inflation is an increase in the money circulating - price rises are just a symptom of this.

As we are invested in a US company, I do believe a little knowledge of this is a good thing to pass on. The 'money' in our pockets buys something because we have faith it will buy something. If that faith goes, that is when the troubles will really begin.

With such a liquid stock, no possible comment here will make the slightest difference. Upside movement is now more probable than downside so short away if that's your business.

Each to their own. I have a large permanent holding but trade in an out constantly with SB's.

I would have thought there would have been some share buying by DEC yesterday, but apparently not.

The price is now the same, pretty much, as it was before the FO announcement. Interesting times.

This has been an issue all along. There have been 3 buyback announcements, the last 2 having both ended in share issues to buy assets. This is something that has bothered LTH's. I suspect it is simply that good assets come on the market at sporadic times and DEC have to act quickly when they do. If there is spare cash then buying back shares (debt at 16% interest effectively) is a fair way of using it.

As i understand it the current liabilities are mainly the hedging contracts which fall within the 12 month period. I don't think there are any debt capital repayments due within 12 months. Hedging contracts are balanced by the sale of the gas and the current liabilities are not therefore quite as onerous as they look. I think actually these current asset column is quite high compared to some periods.

In the light of gas prices taking a beating today then it is holding up well

Hello Jim.

Go to the FR webstite. Section 7. Division of Earnings. It quite clearly states that the stockholders get, after expences, a dividend of 6% on their paid in capital. This is a fancy way of saying they get interest on their paid in capital but as this comes from their own purchase of bonds created by the treasury with federal reserve 'money' then it's free money anyway.

As for off topic, I disagree. We partly own a US company and it's vital to understand their system and potental pitfalls. I will hopefully be invested for many more years and a currency crisis is all but inevitable at some stage in the future.

I started to get really interested in economics - especially in the US, during lockdown. I could not understand why the stock market was soaring when most businesses were shut. It seemed totally contrary. As we here are invested in a US company I thought I would start posting a few items every now and then on the subject. I personally think it is really important to understand how the dollar works, what is behind it, and what the potential risks are.

The Federal Reserve: It looks like the US debt ceiling will, until the next time, be raised. Here are some interesting facts on the FR.

The FR is not a government agency at all but a private one. Set up in 1913 by, at the time, the largest banks in the US. These banks are still the stockholders of the FR and get a dividend each year from it. No one is quite sure which banks are now the stockholders (due to mergers etc) but it is fair to say the major banks still control it.

As such when, in 2008, the banks asked the US government to bail them out, it was actually the banks bailing themselves out via the FR with tax payers future taxes. An autonomous entity - hardly; It is a totally self serving one.

I think there are share buy backs and then share buy backs, with any number of reasons behind them. DEC have a slight problem. They have just raised capital at £1.05 and had a 20% fall. If it stays where it is then any further capital raise via a share issue might get quite a bit harder.

So I agree that a free cash share buyback period would help the SP as it really does directly save a heep of money, and will show the recent investors DEC are serious about what they do and what they believe in.