Since Mitcham Industries released 2nd quarter results, analysts have increased their EPS estimates for next year from 40 cents to 63 cents.
My Fair Value esimate for MIND is now $12.50/share.
MIND has less than 10 million fully diluted shares and a very small float. If they report good 3rd quarter results and an optimistic outlook, this one could really make a big move for us.
Dan
MIND
Re: MIND
With the run made by Mitcham Industries (MIND) this week, I decided to take a hard look at my forecast model.
My Fair Value estimate (current break-up price) is now $13/share.
Premium Members should take a hard look at my model which can be found under the Sweet 16 Tab.
MIND's Balance Sheet is rock solid and they will be reporting very strong Q3 and Q4 earnings and cash flows.
Dan
My Fair Value estimate (current break-up price) is now $13/share.
Premium Members should take a hard look at my model which can be found under the Sweet 16 Tab.
MIND's Balance Sheet is rock solid and they will be reporting very strong Q3 and Q4 earnings and cash flows.
Dan
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: MIND
dan i took a look at the mind spread sheet a few days ago and was somewhat surprised that you based your fair value on cash flow/share. i understand why you do that for an E&P, but mind is not that and imo is really a cyclical company. can you explain your reasoning and why forward looking eps expectations are not used?
tia
jim
tia
jim
Re: MIND
Cash flow per share always means more to me than EPS. Cash flow pays the bills, not EPS.
> MIND is still trading below Book Value per share. That is ridiculous since we know they aggressively depreciate their lease equipment (very conservative Balance Sheet).
> I'm bullish on oil and MIND's business is directly tied to the exploration budgets of the large-caps. Demand for seismic is increaseing as new reserves become harder and harder to find.
> On your point. Depreciation of their Lease Equipment is the largest expense they have. IMO this distorts how strong their business is. The Lease Equipment is not depreciating that fast. In fact, since MIND buys large volumes of seismic equipment they get it at a HUGE discount. Note that whenever they sell used equipment it has a HUGE profit margin (around 60%) on the stuff.
From my model:
FYE
Year - EPS - CFPS
2009 $0.91 $3.17
2010 $0.05 $2.16 < See how distortive EPS is?
2011 $0.43 $2.75 < This year's forecast
2012 $0.59 $3.29 < MY forecast for next year is actually below the current First Call forecast.
MIND is worth at least 4X CFPS. Billy Mitcham would laugh at any offer below that for the company.
Dan
> MIND is still trading below Book Value per share. That is ridiculous since we know they aggressively depreciate their lease equipment (very conservative Balance Sheet).
> I'm bullish on oil and MIND's business is directly tied to the exploration budgets of the large-caps. Demand for seismic is increaseing as new reserves become harder and harder to find.
> On your point. Depreciation of their Lease Equipment is the largest expense they have. IMO this distorts how strong their business is. The Lease Equipment is not depreciating that fast. In fact, since MIND buys large volumes of seismic equipment they get it at a HUGE discount. Note that whenever they sell used equipment it has a HUGE profit margin (around 60%) on the stuff.
From my model:
FYE
Year - EPS - CFPS
2009 $0.91 $3.17
2010 $0.05 $2.16 < See how distortive EPS is?
2011 $0.43 $2.75 < This year's forecast
2012 $0.59 $3.29 < MY forecast for next year is actually below the current First Call forecast.
MIND is worth at least 4X CFPS. Billy Mitcham would laugh at any offer below that for the company.
Dan
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group