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Alexander Prindle

 
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  • Preciously Functional: Palladium May Outshine Its Cohorts ... Again [View article]
    You raise a good point, amat9112000, I should have mentioned physical.

    Couple things, though: 1) the spread is usually wider, 2) it will take longer to exit your position (delivery and processing time).

    If you buy futures you can obviously take delivery instead of trading out. One might have a difficult time unloading substantial weights without using futures--not really sure.
    Jan 21 04:18 PM | Likes Like |Link to Comment
  • Preciously Functional: Palladium May Outshine Its Cohorts ... Again [View article]
    Personally, I think that investing in Pd miners is a more complicated way to gain exposure. One must not only consider the direction of the metal's market, but also consider the company's fundamental details (multiples, leverage, quality of mines, etc.)

    I would treat each miner uniquely, whereas the commodity is basically the commodity (ignoring the nuances of a physical ETF vs holding physical, obviously).
    Jan 21 04:08 PM | Likes Like |Link to Comment
  • Preciously Functional: Palladium May Outshine Its Cohorts ... Again [View article]
    I appreciate the feedback.
    Jan 21 04:03 PM | Likes Like |Link to Comment
  • Adams Resources & Energy, Inc. EPS of $1.65 [View news story]
    The press release states $1.70, please correct.
    Nov 9 08:43 PM | Likes Like |Link to Comment
  • Thoughts On Nobel Prize Winners Fama, Hansen And Shiller [View article]
    *mathematics *mathematician

    ... your recent article on decay suggests you should know this! :)
    Oct 15 11:15 PM | 1 Like Like |Link to Comment
  • Kodiak Oil & Gas: Current Valuation Too Rich For Profitable M&A/Public-To-Private Buyout [View article]
    Your comment confuses me somewhat, so please forgive me if I have misunderstood you.

    1) The title represents the thrust of the article--it is meant to be obvious.

    2) They have ~$500MM left on their revolver. See the link in my article. I find your guarantee that they won't offer more debt or equity to be misleading. I don't know if they will, and I'm not claiming to, but it is an important consideration for a potential investor.

    3) I have to wonder if you got past the title and read the article. It suggests that while KOG is currently richly valued (on a short-term buyout basis), I view it as an attractive investment due to petro growth and operating margins.

    Therefore, your odd attempt at providing nebulous valuation instruction is irrelevant, considering you are advising me to do something I have already done. Curiously, we agree that it is a strong investment with good upside!

    Thanks for reading,
    Alexander
    Oct 15 03:28 PM | Likes Like |Link to Comment
  • Kodiak Oil & Gas: Current Valuation Too Rich For Profitable M&A/Public-To-Private Buyout [View article]
    There seems to be a disconnect, so allow me to reflect on the salient points.

    Indeed, my article states one hypothetical valuation scenario of $25/share. That scenario, as stated, implies petro growth is maintained at 170% AND the current ~$15,000 premium per flowing barrel valuation is maintained.

    As my buyout charts indicate, that premium is 15,000 above my highest BOEPD basis for M&A valuation--so, that's around a $35,000 premium over the mean M&A cost basis. Considering KOG is currently valued ~35,000 above the mean M&A value I'm using and ~15,000 above the highest M&A value I'm using, I feel extremely comfortable calling it overvalued on an M&A basis, as my title clearly states.

    So when I say, "My calculations suggest a possible 100% return...", I mean what I say, with the emphasis on possible. That valuation reflects the hypothetical confluence of several positive events, none of which are a buyout. In fact, I said that value ($25/share) is yielded by "maintaining its current premium", among other variables.

    The astute reader will notice that there is also a valuation scenario where KOG is already overvalued, inclusive of factoring in excellent oil growth. Again, that is on an M&A basis not a peer review basis.

    Sorry that my title displeases you, but I stand by it because I argue--and believe--that KOG is currently overvalued on an M&A basis. As I said before, that doesn't preclude an equity from being a good investment.
    Oct 7 12:52 PM | Likes Like |Link to Comment
  • Kodiak Oil & Gas: Current Valuation Too Rich For Profitable M&A/Public-To-Private Buyout [View article]
    It's interesting you say that. Personally, I don't see a buyout occurring at that level--it is a really expensive price. Maybe if, 1) KOG is cash flow positive, 2) KOG doesn't dilute or offer more debt, 3) the market at large remains bullish, someone would pay that much. Even then, I think the buyer would have to be really smitten with KOG--not just the Bakken--to be willing to pay such a high per-flowing-barrel figure.

    Anyways, we can agree that doubling is definitely the best case scenario, even if we disagree about what could facilitate that sort of valuation.
    Oct 7 12:13 PM | Likes Like |Link to Comment
  • Kodiak Oil & Gas: Current Valuation Too Rich For Profitable M&A/Public-To-Private Buyout [View article]
    I don't think it does.

    The current valuation IS too rich for a profitable buyout, as indicated. Therefore it is an appropriate title, especially considering the Repsol talk.

    Furthermore, because an equity is currently valued outside of reasonable profitability in the M&A field hardly means it isn't a viable long term investment.

    Unless, of course, you are a die-hard value investor, which renders the E&P sector something of an arch-nemesis.

    Thanks for reading,
    Alexander
    Oct 7 11:08 AM | Likes Like |Link to Comment
  • Bakken-Alia! Why Kodiak And Its Peers Will Outperform In Q3, Q4 And Beyond [View article]
    What metrics are you using to generate YE future value @ 15-16?

    Thanks,
    Alexander
    Oct 1 12:36 PM | Likes Like |Link to Comment
  • Halcon Resources Looks Playable: Increasing Production, Oil Prices [View article]
    Hey,

    Not exactly sure what you are asking. The assets will sell for $302 mil (not half?), but the divesture won't close until ~4Q13, so don't expect HK to receive the increased liquidity until then.

    In terms of cash generated from production, I can only speculate, but I anticipate margins and production to generally increase from this time. However, margins in some areas will be better than others, as some are further along the development curve. For instance, the Eagle Ford and the Bakken should see increases as Halcon transitions to pad drilling, while the Utica will likely lose money for a bit longer.

    Hopefully that answered your questions.

    Thanks,
    Alexander
    Sep 23 01:00 PM | Likes Like |Link to Comment
  • Halcon Resources Looks Playable: Increasing Production, Oil Prices [View article]
    To get back to you:

    HK hedges ~80% of their current production, and the percentage that is hedged is not fixed price.

    Therefore, it is clear that higher oil prices *do* have an impact on their cash flow.

    Thanks,
    Alexander
    Sep 23 12:55 PM | Likes Like |Link to Comment
  • Halcon Resources Looks Playable: Increasing Production, Oil Prices [View article]
    JF,

    Valuing O&G is always a bit dicey. With HK I feel comfort with the equity, even valuing them at a discount.

    For instance, using approximate numbers: if we take HK's book value at around a 25% discount, the P/B is still less than one. It would take approximately a 70% asset discount to get to the same P/B of KOG. Or, another way to get there would be for HK to trade at close to $20.00 per share. Also realize that these loose calculations are based on 2Q13 values. Since then HK has gone down a good bit, and KOG has gone up a good bit; therefore, the percentages I mentioned are likely to be even higher.

    The market seems to think KOG is worth that sort of inflated valuation (despite slower recent production increases!). Personally I think HK is the better deal today for a long-term shareholder. Maybe KOG is closer to a LBO--I'm not sure.

    Glad to hear you liked my article--thanks for reading!

    Best,
    Alexander
    Sep 11 02:57 PM | 2 Likes Like |Link to Comment
  • Halcon Resources Looks Playable: Increasing Production, Oil Prices [View article]
    govols,

    Margins will likely be a slower improvement, but having operations and EPS remain positive would be an excellent sign.

    In any case, production is my focus--as is usually the case in a small E&P growth story.

    Thanks for reading!

    Best,
    Alexander
    Sep 10 08:39 PM | 1 Like Like |Link to Comment
  • Halcon Resources Looks Playable: Increasing Production, Oil Prices [View article]
    Anne,

    Thanks for reading!

    Best,
    Alexander
    Sep 10 08:37 PM | Likes Like |Link to Comment
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