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Teacherman1 (62.19)

Half Price Sale on AXAS

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April 09, 2013 – Comments (2) | RELATED TICKERS: AXAS

If you follow this stock at all, you are aware that they had a "challange" by one of their institutional shareholders concerning the true value of the company (which the investor thought should result in  a higher share price and was concerned that more could and should be done to bring this about), and the desire to have representation on the board to make that happen.

A "proxy fight" was starting to take place but they have since come to a "friendly agreement", with the resignation and replacement of one existing member and increasing the board by one additional member. You can check this out on their web site and in SEC filings.

As I am writing this, the share price of AXAS is about $2.22, but the investor (as well as the company), place the true value at $4 to $5.

The CFO of the company is now embarked on a "sponsored, no-deal road show" to present their case to potential investors.

You can see the information being presented by going to their web site or SEC filings.

There is a lot of information in the presentation, but the core "ingredient" is their NAV (Net Asset Value), which as of the end of 2012, was $4.47. This is slightly twice the current share price.

To assist in understanding how E&P companies are valued (which is different than more traditional companies), I have included a link to a really good, easy to understand short course in how to do that

This site is called BIWS (Breaking Into Wall Street.) by Brian DeChesare, and this particular course is called  "Oil and Gas Modeling 101". 

http://search.yahoo.com/r/_ylt=A0oGdVV6IWRRaBYAWcdXNyoA;_ylu=X3oDMTE1MGhjZWU2BHNlYwNzcgRwb3MDOQRjb2xvA3NrMQR2dGlkA1ZJUDIyOV8yNDk-/SIG=12fe6q536/EXP=1365545466/**http%3a//www.mergersandinquisitions.com/oil-gas-modeling-101/

This is an extremely well written, and easily understandable explaination of how to value E&P companies.

I expect AXAS to continue to grow their production and pay down their debt, and realistically see it as an $8 to $10 stock in the next few years.

JMO and worth exactly what I am charging for it.

2 Comments – Post Your Own

#1) On April 09, 2013 at 10:39 PM, Option1307 (29.90) wrote:

I haven't followed this stock much but seems intriguing, thanks for the idea!

 

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#2) On May 02, 2013 at 12:00 AM, Tagit (62.78) wrote:

Jim, I  hope you and your family are doing well. I dropped in the TMF before heading to bed and wanted to wish you and the family well. Keep on fooling onward !! You da man sir....

Good Night.

 

P.S. I rec this one when you posted it =) 

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