Member Info for asartara

FCF of $2b with gearing less than 1 would allow an annual dividend of $1.5b or about 60p per share

That would give a dividend yield of over 21% at the present share price and so the present share price for HBR is clearly absurdly low

When HBR eventually trades in the US the price will be nearer to £8 than £3

They may have a similar Market Cap but you have to look at the debt and EV as well as the Market Cap

The Market Cap of HBR is about £5 billion assuming 1.8 billion shares including the 250 million non voting shares

Add another £4 billion for debt for an EV of about £9 billion

Ithaca EV is probably nearer £5 billion so the EV of HBR is probably near to double the EV of Ithaca

I also think the market has punished HBR for the recent changes to the dividend policy

Ithaca is still paying a dividend of about 22.5p per year giving a dividend of about 8.7%

While HBR has now set a minimum dividend of about 12p per year giving a minimum dividend of just over 4%

Many income investors have probably sold out of HBR because of this change

I doubt that Brent will go as low as $70

$75 or $80 will probably be the lowest it will go even if the war ends

This research does not look very good for Partners Group

https://grizzlyreports.com/pghn/

"It may not if HBR buy direct from BASF and then cancel that would boost the share price"

Are HBR allowed to buy tens of millions of shares direct from BASF?

Are there not some rules that would prevent them from doing this?

If it is so easy then why did HBR not just buy and cancel the recent 80 million shares that BASF sold?

I think the market is aware that there will soon be more huge sales from BASF and LLOG and these sales will obviously be at a much lower price than the market price

So any buyers will probably be hoping to buy HBR at a lower price nearer £2.60

It is a bit like buying any other asset such as a house

Why buy the house today when you know that it will soon be 10% lower ?

"It should be a lot higher"

So what are the calculations?

Have you seen them?

Has anyone seen them?

And what company with a sensible management would want to buy a UK oil company with Milliband and Rayner and the Green Party all waiting to steal most of the shareholders money ?

The good news is neither will take part in the next Government

That is not correct

Unfortunately it is quite likely that the next Government will be some kind of horrible Labour / Green / SNP coalition

Does anyone know how Zenith have calculated this $570 million claim ?

Has anyone actually seen the calculations ?

How has this figure been calculated?

It seems like a very high amount

Is there not a risk that even if Zenith win the case ICSID will award a much lesser amount such as $50 million or less ?

Now you still have to reduce the price a long way for the following :

1. US very low tax for ARC v UK very high tax plus EPL for HBR

2. ARC has about 2 billion 2P reserves v HBR with about 1 billion 2P reserves

3. And what company with a sensible management would want to buy a UK oil company with Milliband and Rayner and the Green Party all waiting to steal most of the shareholders money ?

So do the calculation again and you may reach a fair price for HBR nearer to £3

Shares in issue 1.58 billion

AI is not correct as usual

The shares in issue are closer to 2 billion

The market cap for HBR must take into account the 250 million non voting shares

So you need to reduce the estimated AI nonsense price from £6 to about £5

And the obvious question is if HBR is such a bargain at less than £3 then why did Shell not buy it for £3.50 or £4 or £5 ?

Why did they choose to buy ARC instead ?

The share price for HBR according to the price chart was

£70 in May 2014

£6 in February 2016

£27 in September 2018

£23 in January 2020

£3.50 in March 2020

£10 in June 2020

These are very large changes in the share price over short periods of time and so the share prices do not seem to make any sense

Does anyone know?

1. Are these historic HBR share prices accurate? or are these prices nonsense?

2. Are any of these historic share prices comparable to the present day HBR share price that is under £3?

3. Why the huge fall in the share price between May 2014 and February 2016?

4. Why the huge rise in the share price from February 2016 to September 2018?

5. Why the huge share price changes in 2020?

6. When does the historic share price become comparable to the present day HBR share price? is it some time in 2020 or 2021?

The share price was over £5 in April 2022 and the oil price then was similar to the oil price today but obviously the EPL has caused a big fall in the share price since then

HBR is in a much stronger position as a company today than it was in April 2022 and so it would seem reasonable to assume that when the EPL is replaced the share price will be over £5 again

The market cap of HBR is usually understated by about $1 billion as the 250 million non voting shares are usually excluded

Any takeover will obviously have to include these shares and so the correct market cap for HBR is actually about $7 billion

A takeover bid for HBR at £4 would certainly be a very bad result when the shares are worth at least £6

And by the time the EPL is lifted HBR will probably have a US listing and a share price nearer £8

Sekforde

"Reading my Sunday Times at breakfast this morning I discover Shell has lost about 10% of its oil and gas that came through the Strait of Hormuz"

I do not see any reference to this story anywhere in the news or on the internet

What do you mean exactly that Shell has "lost" 10% of their oil and gas

Has someone destroyed or stolen their oil ?

And if so then surely they will be insured against this loss ?

I do agree though that HBR would probably be a good acquisition for Shell

Reuters

BLOCK TRADE: HARBOUR ENERGY SECONDARY ABO FINAL DEAL SIZE 80MM SHARES, ORDERS BELOW GBP 2.73 RISK MISSING - BOOKRUNNER

Stupmy

It may be a concern to have a large shareholder selling out but what can be done? If someone wants out then they want out.

Probably best for HBR to negotiate with BASF about a US listing and then BASF will probably have many willing buyers for their shares at a much higher price than the current LSE price

Hi Sekforde,

Thanks for the answers

Yes sometimes I think the market is not looking at the same figures as the present valuation of HBR does not make much sense unless the demand for oil collapses in about 5 years due to the increased use of renewable energy, or if the oil price collapses in the next 5 years like it did a few years ago

I also like SQZ as the EPL will end sooner or later, and anything but a Labour or Green government should be good for UK oil companies

I asked you about ITH as it is difficult to understand why it has a similar Market Cap to HBR but only about one quarter of the production

Neversell

"I cant help feeling slightly concerned about our current major shareholders and what’s gone on this week"

What is it that you are concerned about exactly?

Is it just the negative reaction in the HBR share price when there are large sales? If so then you could perhaps use it as an opportunity to buy HBR at a better price

Or are you concerned about something else? For example, are you concerned that there may be some problem with HBR that only these large shareholders may know about?