Dan: Media speculation continues to mount that BEXP worth 10-15% more. Bud and the boys at BEXP know their company inside and out; you would think that they are shrew enough to know what they have-- and would ask top dollar for their assets--they have enough security not to concern themselves with selling stockholders out for personal enhanced golden parachute)
What do you think about a higher price or competing company entering the fray? This should be right up your alley of past experience and your experience goes a long way toward deciding short term to wait or to take the cash now and go elsewhere. And if elsewhere; what's the next closest look- alike to another BEXP.
BEXP Sale too Cheap?
Re: BEXP Sale too Cheap?
My Fair Value estimate for BEXP is $38.56/share, so there may be other companies taking a hard look at making a competing bid. However, my valuation is at best a rough estimate and I have no way of knowing if some of their Bakken acreage is sub-economic.
Other potential Bakken takeover targets: OAS, KOG, WLL and TPLM.
NOG is not on the list because their assets are all outside operated. Large-caps always want to operate.
PetroBakken is not on the list because PetroBank holds 59% of the outstanding stock. However, I do think PetroBakken is trading at a deep discount to what their Bakken and Cardium acreage is worth.
Denbury Resources (DNR) has a very attactive block of Bakken acreage and today produces over 6,000 BOPD from the Bakken. IMO Denbury would be open to an offer similiar to what Brigham got. Plus, it is much easier to close an asset transaction than a takeover. Note that DNR has made a nice run since the BEXP deal was announced, so I'm not the only one thinking about this.
Other potential Bakken takeover targets: OAS, KOG, WLL and TPLM.
NOG is not on the list because their assets are all outside operated. Large-caps always want to operate.
PetroBakken is not on the list because PetroBank holds 59% of the outstanding stock. However, I do think PetroBakken is trading at a deep discount to what their Bakken and Cardium acreage is worth.
Denbury Resources (DNR) has a very attactive block of Bakken acreage and today produces over 6,000 BOPD from the Bakken. IMO Denbury would be open to an offer similiar to what Brigham got. Plus, it is much easier to close an asset transaction than a takeover. Note that DNR has made a nice run since the BEXP deal was announced, so I'm not the only one thinking about this.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: BEXP Sale too Cheap?
BEXP is up 169.7% since being added to the Sweet 16 on 1-1-2010, so I'm definitely pleased with how this one has worked out. GPOR (up 172%) and TGA (up 319%) are the only stocks that have topped it. IMO they both have a lot more upside for us.
I'm currently looking at several companies on our Watch List as a possible replacement for BEXP. I will make a decision by October 31. I'm planning to make six to eight changes to the Sweet 16 on January 1, 2012.
Mitcham Industies (MIND) is right at the top of my Best Buys list right now. Come to our luncheon on October 28 to find out why. (Hint: MIND is debt free and their earning per share are set to skyrocket over the next two quarters.)
PS: CLR is another potential Bakken Takeover Target. Only a handful of companies are big enough to make a run at CLR.
I'm currently looking at several companies on our Watch List as a possible replacement for BEXP. I will make a decision by October 31. I'm planning to make six to eight changes to the Sweet 16 on January 1, 2012.
Mitcham Industies (MIND) is right at the top of my Best Buys list right now. Come to our luncheon on October 28 to find out why. (Hint: MIND is debt free and their earning per share are set to skyrocket over the next two quarters.)
PS: CLR is another potential Bakken Takeover Target. Only a handful of companies are big enough to make a run at CLR.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group