Devon Shire
Long only, newsletter provider, oil & gas, small-cap

Go Long Novus Energy, Short Raging River

Raging River Exploration Inc.

Raging River (OTC:RRENF) is the Viking oil producer of choice for Mr. Market. I believe that Raging River is an excellent company, but that its valuation is fair.

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Meanwhile, Novus Energy (OTC:NOVUF) is the Viking oil producer that Mr. Market has forgotten about. I believe that Novus Energy is also an excellent company, but its valuation is extremely compelling.

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These companies are similar in size, they are 100% focused on the same play, have similar growth rates and focus on oil but very different valuations.

I don't think those valuation differences make any sense.

Therefore I think I rewarding strategy could be a paired trade of...

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