VOC Energy Trust Units Are Trading At A Discount To Their Intrinsic Value [View article]
Absent significant news, one can never tell what causes a decline in unit price. So the following is simply a guess. There are other trusts that published PV-10 values in their 10-Ks that were revised downward. Another seeking alpha contributor highlighted those today and the shares were hit hard, such as CHKR.
VOC Energy Trust Units Are Trading At A Discount To Their Intrinsic Value [View article]
VOC Energy Trust Units Are Trading At A Discount To Their Intrinsic Value [View article]
Sandridge Mississippian Trust II Units Are Undervalued After Recent Price Decline [View article]
The well depletion rate raises obvious concerns. It is probably the number one reason the discount to PV-10 is available. The math is concerning.
One can purchase near term puts at $12.5 or $15 to protect against wildly inaccurate reserve estimates and / or misleading management.
REDI