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Josh Young

 
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  • Two Reasons Why Herbalife Was Not Bought Out In The Midst Of A Bear Raid - A Theory [View article]
    Thanks for the comment. Its about both - JH Whitney's no-bid on Herbalife seems related to its former Managing Director's recent 30% position in Austex.
    Jan 17, 2014. 03:32 AM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    J,

    Thanks for the note. Yes, there are substantial warrants and convertible notes outstanding. Yes, I look at the dilution like you do - it hurts the equity valuation somewhat, but also helps because it de-levers the company as the stock price rises and gives them cash to accelerate development. If the stock were at $15 usd today with volume, the company could potentially rapidly increase the number of wells drilled per month and could exit the year with way more than 3,000 boepd of production, driving further equity value.
    Jan 14, 2014. 01:08 PM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Should be both. Revenue and cash flow of course matter, as they do for any business.
    Jan 14, 2014. 08:17 AM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Adam, thanks for the comment, you've done some great work here on seekingalpha. Austex primarily trades on the ASX. It is very common for much larger companies that trade on foreign exchanges to be listed on the otc as well.

    In Austex's case in particular, considering it has us assets, listing on a major us exchange could help.
    Jan 14, 2014. 08:15 AM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Their reserve report is compliant with Canadian and Australian exchange standards, and is consistent with other public e&p companies. Please share more about your "maths"
    Jan 14, 2014. 08:13 AM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Thanks, I really appreciate that comment, glad you're making some money on this idea. I agree that it was remarkable to see the PWC fairness opinion. Has anyone ever seen a fairness opinion that said a deal was unfair, particularly when the author of the opinion (PWC in this case) was being paid by the party seeking the opinion (Austex in this case)?
    Jan 13, 2014. 11:07 AM | 1 Like Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    If you sold recently, the buyer of your stock was likely the Stone family, ~31% owners of Austex. They made billions for their clients through their investments and are making their single largest public investment to date in Austex...

    Re: information flow, the company publishes quarterly reports and is in compliance (as far as I know) with Australia's strict securities laws.
    Jan 13, 2014. 02:08 AM | 1 Like Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Karuna,

    Most of the stock the Stones got is through a convertible preferred deal, which converts at 16 cents per share. The stock is less than 10% above that conversion price, so it is very close to their effective cost for ~2/3 of their shares. If the reserve reports and analyst reports are right and if the stock is worth ~$0.30 per share, than there may still be most of the upside remaining at 17 cents per share.
    Jan 12, 2014. 11:57 PM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    I'm not sure I fully understand the question or agree with some of the premises.

    There have been numerous wells drilled in Austex's field and in the adjacent field by Range. The results from these are likely incorporated into the reserve engineering reports. It appears there is significant upside to the numbers in these reports, given the repeated upwards revisions over the past 18 months.

    Also, I think being in one basin makes it more likely, not less, that Austex would be an acquisition target. It is much easier for a mid-sized E&P to tack-on a high growth single area than try to merge in a complex organization active in multiple basins.

    Does that help?
    Jan 12, 2014. 11:51 PM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    I bought some GMET after it fell to a ridiculously low price due to tax loss harvesting and then I wrote about it. It subsequently doubled and has continued to trade at 2x the price it was at prior to my article. I think it was simply mispriced, and I fully disclosed the size and illiquidity prominently in that article.

    AOK is also not very liquid and also appears mispriced. I would be thrilled if the stock behaved like GMET, and if readers bought it at 8, after it traded up from 7 prior to the article being published, and it traded up to 15 and stayed at 15 at higher volume than before the article, I think everyone would be happy. Small cap stocks are more often mispriced than large cap stocks...
    Jan 12, 2014. 10:05 PM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Thanks for the comment. I am generally bullish on the price of crude oil over the medium term. The global marginal cost of production continues to rise, and the natural decline curve of the supply of oil is increasing as more production shifts to unconventional production. More capital is spent every year to replace declining production, which demands a continually higher price of oil. I think this trend continues unless there is a sharp correction in demand, potentially driven by alternatives or an economic shock like China's economy slowing down further.
    Jan 12, 2014. 09:37 PM | 1 Like Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    JF, there is a 50 to 1 conversion between ATXDY and AOK AU. There is also a currency conversion that needs to be factored in between USD denominated ATXDY and AUD denominated AOK AU.
    Jan 12, 2014. 07:36 PM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Yeah, ATO V is the Canadian listing, had no volume until Friday. Atxdy and aok au have more liquidity.
    Jan 12, 2014. 11:44 AM | Likes Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Nytex, Austex has improved the drilling and completion techniques used in the area and has far better well results than nearby competitors except for some of those excellent vertical wells drilled by range.

    Before a blanket dismissal of this idea, look at the massive insider buying by sophisticated investors who have made their clients BILLIONS of dollars and at the PWC fairness opinion.

    As you said, you have not done a thorough evaluation of this security. You can be sure the insiders buying huge amounts of stock around the current price have...
    Jan 12, 2014. 11:42 AM | 1 Like Like |Link to Comment
  • The Next Great Investment Idea: AusTex Oil Is Trading At 1/3 Of Proved Reserve Value, Growing 300% Per Year [View article]
    Austex is one of the lowest cost producers in North America, as mentioned in the article. Oil price movements affect them less than other, higher cost producers. The concern you mention is general - if one is worried about this, it is easy to short oil or an E&P index. The point of my article is that, under current conditions, Austex is radically mispriced compared to other public e&ps and to the value of its field.
    Jan 11, 2014. 06:30 PM | 1 Like Like |Link to Comment
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