Member Info for Corriedog

They are-

Don’t invest in companies that might go bust

Make sure that they turn profit into cash

Make sure that they have a growth plan

Do they embrace changing times and technologies?

Do they pay dividends out of free cash flow

Do they have a competent management team with skin in the game and not just share options

Can you buy in when the market isn’t looking and putting sky high valuations on companies that gobble cash and don’t make a profit?

What better case could there be for Harbour on a p/e of about 1.5/2?

I forgot to add that, with debt being paid off, the enterprise value will be down to £3.5bn within the next 12 months.

Then it will be valued at much less than one year’s operating cash flow.

What is this really worth? Any number that you like north of the current 375p.

In 2021, there was turnover of $3.6bn, operating cash flow of $1.6bn and free cash flow of $678m.

The sterling dollar exchange rate was worse than now so we received less in pounds.

Extra tax will average out at about $300m for three years. De minimis in the scheme of things.

Hedging prices will gradually improve.

At 80m boe produced and sold that will generate $6.8bn turnover in 2022. Not far off double last year. After opex at $16 that is about $5.5bn gross profit. Think about that.

Knock off some overheads and interest and the operating cash flow is about $4.75bn. In just one year.

Today’s enterprise value of about £4.75bn - market cap plus debt- is about 1.25 times operating cash flow in sterling.

This is priced for a collapse in prices to $50 or so, end of oil use by 2025 or something else that isn’t going to happen.

Really? And that is why Warren Buffet is buying oil companies ladies and gentlemen.

It is only a horror show if you want to sell but not if you want to buy.
The price is just getting better and better - and the fundamentals look great.

Warren Buffet is buying oil shares. Enough said.

How many times can you mount surprise after surprise to keep plucking the golden goose?

A 65% tax rate when other companies are paying 19%. Can’t offset past losses or decommissioning costs.

The goose will not stand by for this plucking. So much for the benefits of Brexit that I supported.

This will result in lack of investment and much higher oil and gas prices and shortages at the pumps. Real bad economics.

The winners? Putin and Saudi.

I agree Giving

We already pay 40% tax rather than 19%

Just keep focus on fundamentals. FTSE 100 company on a p/e of 1.5 and an enterprise value of twice cash profit. Cautious and experienced management team who are unlikely to do something stupid.
Everything else is currently irrelevant.

Do you buy or sell on those numbers?

On a forecast p/e now of about 1.5. With lots of hedging at circa $60 and somewhat worse on gas

Just look at fundamentals. Doesn’t matter what GIC do.

Free cash flow forecast for this year of $1.6bn after tax, dividend and capex. Market cap at today’s price of £4bn.

Share price is a gift for a FTSE 100 company.

Might help if directors invested and surprised that they aren’t.

Harbour pays tax at 40% on North Sea profits and can’t deduct interest currently. All other companies pay 19%

Fair? Never reported by the press.

We had $800m of tax losses at 31/12.2020

20% more tax Pearls not 10%.

If oil drops to $20 again then maybe the government will give us a windfall payment

More sellers than buyers. Simple.

I just look at the numbers and particularly cash Robina.

If you don’t like it or trust it then you shouldn’t own it.

Why does the company need to turn around. This is a company for the future not the past and is still building.

It was over valued and is now undervalued.

A quality company with quality management.

Fundamentals here and cash generation are very sound here.
Sound and very experienced management.
Positioned for the future not the past.
No harm to have a pause in acquisitions and show the strength in organic growth and not needing to adjust numbers for cost of acquisitions etc.
A great company standing at below its real value.

Fill your boots while stocks last

I hope that they don’t use cash for share buy backs. It is a waste. Progressive dividend or m and a best.

It generated $900m in operating cash flow in three months. Debt reduction plus capex plus tax paid.

Enterprise value is under £6m. Market cap plus debt.

What is the ‘real’ share price? Not 460p. At current rate that is only twice operating profit or Ebitda.

If enterprise value remains to be held low then share price has to go up by $1.7m in next year as debt falls. But if two times multiple goes to a proper number Boom.

Why is Buffet buying oil shares?