Seeking Alpha

Josh Young

 
View as an RSS Feed
View Josh Young's Comments BY TICKER:
Latest  |  Highest rated
  • 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, 2013. 01:28 PM | Likes Like |Link to Comment
  • Wattenberg Transaction Read Through To Public Companies In The Area [View article]
    Bankstocks, that is a good point, but the valuation difference is pretty extreme. And SYRG seems to trade at a much higher valuation on 2014 numbers than BBG and BCEI.
    Nov 15, 2013. 04:20 PM | Likes Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    Lucas is ~100 feet from the closest EOG well - its leases are adjacent to EOG leases that EOG has already developed.

    SYRG is miles away from acreage Noble recently acquired and even further from horizontal wells that have actually been developed.

    And SYRG is nothing like GeoResources. I was a significant investor in GEOI's $12 equity offering...
    Nov 15, 2013. 12:34 PM | 2 Likes Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    Synergy paid $212 per acre in March 2013 for almost their whole Extension acreage position (17,000 net acres) - http://bit.ly/1gQpBW8

    Whiting has extended their acreage south but are still miles north of Synergy's acreage block. I'd suggest connecting with the other operators in the area to get a better understanding of the geological changes as you approach Synergy's acreage.

    You wrote an excellent article on SLCA / EOG, I'm sure you can do the work and figure this out.
    Nov 15, 2013. 02:02 AM | 1 Like Like |Link to Comment
  • Wattenberg Transaction Read Through To Public Companies In The Area [View article]
    Dmiller,

    It looks like they got a decent deal. Which I think highlights their valuation versus what assets are going for in the private market. BCEI and BBG trade for a lot closer to private market asset value than SYRG, based on the metrics discussed above.
    Nov 14, 2013. 09:44 PM | Likes Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    Far enough for acreage to sell for a few hundred dollars per acre rather than thousands of dollars per acre. Order of magnitude difference in price...
    Nov 14, 2013. 04:26 AM | 2 Likes Like |Link to Comment
  • Meramec Shale Oil Play Unveiled By Newfield Exploration [View article]
    Got it, thanks. Its on a sub row which is probably how I missed it. 800-1,000 mboe is not bad at all...
    Nov 13, 2013. 08:29 PM | Likes Like |Link to Comment
  • Would You Fund This Company? Capital Destruction At Green Hunter Resources [View article]
    Can you say why you "believe" this. My view is purely driven by data - the data says (in my understanding of it) that Green Hunter has accumulated ~$150 million in losses so far, and that it needs to raise money just to stay in business.
    Nov 13, 2013. 07:48 PM | Likes Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    It makes a huge difference in the private asset market. Acreage sells for way more in Noble or BCEI's core area than in the area SYRG picked up acreage. There's a reason there aren't others bidding for it.

    Speaking of private market, here's something I put together on the transaction announced today. http://seekingalpha.co...

    Private market is saying SYRG is currently not worth a whole lot, and even if it grows to Bill's estimates it maybe might be worth ~65% of what its trading for towards the end of next year.
    Nov 13, 2013. 06:15 PM | 2 Likes Like |Link to Comment
  • Would You Fund This Company? Capital Destruction At Green Hunter Resources [View article]
    In that case, look at NES - just being in the oil services business doesn't guarantee success, and these particular niches seem to be challenging for whatever reasons.
    Nov 13, 2013. 02:21 PM | Likes Like |Link to Comment
  • Would You Fund This Company? Capital Destruction At Green Hunter Resources [View article]
    Tack, you're saying that GRH's future will be determined by MHR's success. I disagree - GRH has been billed for things like Gary Evans plane use (note the account payable from the June quarter) - and the low margin achieved on the MAG tank GRH sold to MHR.
    Nov 13, 2013. 02:12 PM | Likes Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    Michael,

    You need to do more work on this area. East Pony is north of Synergy's "extension" acreage, in an area with substantially better rock.

    And BCEI is to the west, also in an area with better rock.

    I went through this all in detail here - http://seekingalpha.co...

    Thank you for sharing your perspective, I think this highlights the attractiveness of the short thesis (driven by valuation and geology). And I think the transaction announced today helps - clearly the private market values core Wattenberg land that is not blocked up at less than $100,000/boepd, with no value for acreage beyond that...
    Nov 13, 2013. 01:32 PM | 1 Like Like |Link to Comment
  • Would You Fund This Company? Capital Destruction At Green Hunter Resources [View article]
    Thanks - I am paying close attention to the business model - it is nothing like Amazon!

    The business model does not appear to be working - revenue did grow, but cost of goods sold rose even more! I was a management consultant prior to becoming a professional investor - negative operating leverage is what put most of the dot coms out of business and is a problem for the two public companies in this space - Green Hunter and Nuverra.
    Nov 13, 2013. 01:27 PM | Likes Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    Why would you own this when you could own stocks that trade at 7x 2014 EV/EBITDA and that have running room to grow rapidly from there?

    It seems sometimes certain stocks go "in vogue" and start to get priced on contingent resources or EBTIDA years in the future. Generally those stocks haven't performed well after trading up to those sky-high valuations.

    Sure, it is growing, but you could own something that is also growing and already trades at a level you hope Synergy might achieve years from now.
    Nov 12, 2013. 03:58 PM | 1 Like Like |Link to Comment
  • Bakken Update: Synergy's Q3 Is Good, But Q4 Will Be Much Better [View article]
    Bill,

    Other high growth E&Ps trade at a fraction of the valuation you're describing. Why do you think SYRG merits trading much higher than the comp set?

    I don't see how it makes any sense to value an E&P at $150,000 per flowing barrel based on an exit production rate a year from now.

    And I'm not sure it makes sense to assume they'll actually achieve the production growth targets they are setting (it takes a lot to get from 2,400 boepd to 7,000 boepd in a year).

    The most recent sell side reports I've seen are valuing Bakken production (with much higher netbacks than Wattenberg boe's) at $60,000 per boepd. At $60,000 per boepd, SYRG's current market value looks rather stretched compared to that implied value.
    Nov 12, 2013. 02:47 PM | 4 Likes Like |Link to Comment
COMMENTS STATS
701 Comments
403 Likes