Hemisphere Energy

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RTaber1
Posts: 75
Joined: Thu May 26, 2016 11:25 pm

Hemisphere Energy

Post by RTaber1 »

Has Hemisphere Energy management mentioned doing a reverse split in their shares to bring the share price over $5 where Wall Street retail brokerages will allow brokers to solicit it?

Or, is management more inclined to become a takeover target as a profitable, debt-free producer with a high netback, low decline asset?

Is their stock buyback going to work if the shares stay in the never, never land of speculative penny stock traders?

Hemisphere survived their Covid near-death experience and is alive and growing. They need someone sexy to tell their remarkable story!

They need a tag line like "Alberta Tough" or other. Alberta might well be our 51st state one day.

These are people like us or I would like us to be people like them.
CreativeEquity
Posts: 107
Joined: Sun Sep 05, 2021 5:06 pm

Re: Hemisphere Energy

Post by CreativeEquity »

Although it trades publically it is managed like a private. For this reason I prefer Inplay.
sl6886
Posts: 138
Joined: Tue Jul 14, 2020 7:57 am

Re: Hemisphere Energy

Post by sl6886 »

A reverse split is a gimmick. Selling the company? Not right now, as the buyer would get all the value (look at Harold Hamm's offer to Continental). The value right now is in the rising FCF.

Hemisphere should be debt free in Q3, with rising FCF from both debt savings and increased production. The potential to pass this on to shareholders is enormous, but the company is HIGHLY reluctant to commit to ANYTHING. Last quarter, Hemisphere gave into Canadian Oil peer pressure and announced "a variable dividend targeting 30% of FCF". It's a start, albeit a somewhat flimsy commitment as "targeting" could mean many things and variable by it's nature, is discretionary. The company has an authorized Buy Back plan for about 6% of the outstanding stock for this year, and many smart people like buy backs plans, but for the unwashed among us, cash is the premier option of choice.

Unlike a reverse split, actually allowing shareholders to enjoy the riches of rising future cash flow payments from production, along with amounts that would otherwise would have gone to debt service payments in the form of dividends would undecidedly add value to the struggling share price. In a prior interview with Dan, the Hemisphere CEO once described the company as a "Cash Cow". At the end of this quarter, they're debt free and for those shareholders among us that have waited a long time to get to this point, a $.05 year-end special dividend that doubles the existing $.025 Canadian dividend, is not a big ask as a reward to loyal shareholders
Fraser921
Posts: 2953
Joined: Mon Mar 22, 2021 11:48 am

Re: Hemisphere Energy

Post by Fraser921 »

Let the unwashed eat cake!
cmm3rd
Posts: 420
Joined: Tue Jan 08, 2013 4:44 pm

Re: Hemisphere Energy

Post by cmm3rd »

For so long as the share price remains significantly undervalued, I would rather see additional available funds be used for maximum share repurchases and (to the extent available) accretive acquisitions to add scale and further improve metrics.
dan_s
Posts: 34465
Joined: Fri Apr 23, 2010 8:22 am

Re: Hemisphere Energy

Post by dan_s »

I added HMENF to our Small-Cap Growth Portfolio in 2018 when it was trading for around $0.20Cdn per share. Today it is trading for $1.54Cdn per share. Since January 1, 2021 it has increased by 600%. So, let's be REAL for a moment. This is one of my best picks EVER!

Don Simmons is doing a great job. He is in this for the long-run and he knows that he has a "Gem of an oilfield" with Atlee Buffalo.

Hemisphere has fantastic operating cash flow growth and it is now generating an incredible amount of FREE CASH FLOW. You guys pay me the BIG BUCKS to find small undiscovered companies just like this.
Operating Cash Flow that is funding all of the Company's growth. All in Canadian Dollars
> Actual: $9.3 million in 2020
> Actual: $18.5 million in 2021
> Actual: $25.1 million in 1H 2022
> Forecast: $30.1 million in 2H 2022 < The Company became debt free in August!
> Forecast: $70.8 million in 2023

It has a clear path to production of 4,000 Boepd in 2023 and likely over 5,000 Boepd in 2024 if the polymer flood of the F Pool at Atlee Buffalo works. Atlee Buffalo could produce at 5,000 BOPD for many years if the polymer floods do what they are expected to do. Hemisphere will need to spend very little maintenance cap to keep the production this high.

This is not a "Story Stock". It is the real deal. Now that the Company is debt free, Don should have over $20Cdn million of totally free cash flow in 2H 2022 to pay higher dividends, buyback a lot of stock or make accretive acquisition.

I talk to Don Simmons on a regular basis. Yesterday, he agreed to host a Houston luncheon for us on November 28. By then he should be able to tell us about the results of his four well fall drilling program.
Dan Steffens
Energy Prospectus Group
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