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Josh Young

 
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  • Barron's Doubles Down On Approach Resources Despite Poor Well Results And Valuation [View article]
    Saying "Barrons is wrong and Approach is valued appropriately compared to its Permian peers" is less interesting and less productive than saying that plus providing an alternative.

    There are huge differences between Approach's Wolfcamp wells and Gastar's Hunton wells. One of which is economics - Approach's wells generate low returns, while Gastar's Hunton wells generate high returns.

    I've discussed Gastar in detail elsewhere, and they have a high quality asset base that deserves at least an in-line multiple. But the point here is Approach's asset base, which is inferior both to its Permian "comps" and to other E&P companies such as Gastar.
    Dec 6 04:38 PM | 1 Like Like |Link to Comment
  • Barron's Doubles Down On Approach Resources Despite Poor Well Results And Valuation [View article]
    Stock sold off on the back of AREX's Q3 results, tells you what you need to know about them.

    GST's stock was up almost 20% in response to its most recent results announcement. Tells you what you need to know about that too.

    Gastar most recently projected $4.5 million costs on their operated Hunton wells. Hunton decline rates are substantially lower than Wolfcamp decline rates, as it is a more conventional play.
    Dec 6 04:10 PM | 3 Likes Like |Link to Comment
  • Barron's Doubles Down On Approach Resources Despite Poor Well Results And Valuation [View article]
    Chief,

    Thank you for the comment. Unfortunately for AREX, those reserves need to actually be drilled for them to be fully recovered. And that drilling, as seen in the type curves and economics above, is not necessarily highly economic. Thus the <$20 share price.
    Dec 6 03:22 PM | 1 Like Like |Link to Comment
  • Barron's Doubles Down On Approach Resources Despite Poor Well Results And Valuation [View article]
    You're missing a few things.

    1) Gastar's cost per Hunton well is trending to <$5 million. They're getting almost 100% IRR from their type curve wells, and the most recent wells have been double the production from their type curves.

    2) Approach's cost per Wolfcamp well is a lot higher, and their production is disappointing relative to their own and other Wolfcamp operators type curves

    3) Resource potential only matters insofar as it is economic. There may be a massive amount of oil shale in Wyoming, but if it costs $300 per barrel to get it out, it doesn't matter. Similar issue for Approach's Wolfcamp.

    4) That unrisked resource potential for GST does not include their potential in the Utica, nor in the Meramec. The current number is likely significantly higher. But what matters isn't unrisked potential, it is economically recoverable oil and gas.
    Dec 6 03:05 PM | Likes Like |Link to Comment
  • Shale Math Coming Into Play Sooner Than Expected For Gastar Exploration [View article]
    I bought a portion of that offering, and like Ptolmey capital, I've been buying in the open market since then.

    Look into who Ptolmey capital is. I think your concern with corporate governance has been resolved going forward.
    Dec 6 10:52 AM | Likes Like |Link to Comment
  • Shale Math Coming Into Play Sooner Than Expected For Gastar Exploration [View article]
    Thanks. Still in it. Management in their last announcement basically said the next Hunton well will be really good too, and another massive result could further re-rate the stock.

    Take another look at AOK. Rapid production growth there...
    Dec 4 10:33 PM | Likes Like |Link to Comment
  • Barron's Recommendation Of Approach Resources Is Underperforming, Better Value Indeed Elsewhere [View article]
    GST has been a winner since the Barrons article, PXD has not.
    Dec 2 08:58 PM | Likes Like |Link to Comment
  • Sonde's Spin-Off Opportunity [View article]
    I think they need to wait for shareholder approval. They should announce when they are planning to make the distribution and the record date for the distribution. Not sure how long that will take, could take a month or more.
    Nov 25 07:06 PM | Likes Like |Link to Comment
  • Colorado Regulatory Environment Turns Unfavorable, Could Negatively Impact Wattenberg Players [View article]
    I like how people create profiles on seekingalpha just to write nonsensical comments about particular companies that they own stock in. This seems to happen with stocks that are being aggressively promoted and with companies that are using their equity as currency - see the comments on my articles on Green Hunter and the deals SYRG has just done using equity to buy land.
    Nov 25 01:22 AM | 1 Like Like |Link to Comment
  • Sonde's Spin-Off Opportunity [View article]
    Tsoukup,

    I agree, Sonde management has managed to disappoint in every way possible. I would not be surprised to see an activist get involved at this point.
    Nov 22 03:05 AM | Likes Like |Link to Comment
  • Sonde's Spin-Off Opportunity [View article]
    I think it is obvious that Zarat is valuable. The question is who buys it / farms in, and what price they pay for it. I don't have a strong view on this, other than that it is likely worth more than the implied value net of Marquee spinoff shares.
    Nov 20 09:43 PM | Likes Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    Bankstocks, you have to incorporate the cost to borrow and availability of borrow in such an analysis. Also, I'll point out that if you grow as fast as SYRG is growing, your natural decline rate is extremely high, which means you need to replace lots of production just to keep production levels flat. If SYRG manages to grow to 7,000 boepd exit 2014, it will have to replace well over 3,500 boepd in 2015 before it is able to grow. Two steps forward, one step back. Which is part of the short thesis- sustaining triple digit growth is extremely difficult, particularly without blocked-up acreage (they are doing pads but the pads are not adjacent to each other, losing some synergies ironically).
    Nov 19 12:06 PM | 1 Like Like |Link to Comment
  • Sonde's Spin-Off Opportunity [View article]
    There will be substantial synergies, using their current ffo number won't help that much.
    Nov 19 04:24 AM | Likes Like |Link to Comment
  • Sonde's Spin-Off Opportunity [View article]
    Sonde has tons of cash relative to mkt cap. It is a very attractive takeout candidate at this point. It could fall but seems unlikely to trade below the value of cash + skwef shares.

    Marquee seems to be very confident in the 37-39 mm cf guidance for next year. Massive synergies from basically shutting down Sonde's operations and using Marquee's people for everything.

    It just seems so cheap to me (thus I bought additional shares recently), its trading as if Zarat has no value beyond potential cost reimbursement over a multi-year period, and as if the exploration portfolio in W Canada is worthless. Neither is true, and spinoffs have a funny way of frequently way outperforming the market.
    Nov 19 04:03 AM | Likes Like |Link to Comment
  • Sonde's Spin-Off Opportunity [View article]
    Thank you.

    I wrote the article and submitted it prior the the Viking deal falling through. I did mention this as a risk in the article "One big risk is that the Zarat JV is not funded".

    Like I said in the article, "Management claims that if it is not funded, they would be able to find another partner on better terms (things are more stable now than they were in the midst of the Libyan civil war and Tunisian political unrest, so the political risk premium may have diminished). But there is no guarantee."

    Anyway, like I said in the article, spinoffs outperform the general market, and this is a particularly off the run spinoff that appears to be particularly undervalued relative to its assets. So we'll see.
    Nov 18 01:28 PM | Likes Like |Link to Comment
COMMENTS STATS
700 Comments
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