BRK discussion, page-2386

I'd have to agree with Geffa regarding the understanding of the business model as I've had feedback and a lot of questions from numerous people first hand when discussing BRK. These questions came from seasoned investors with decades of experience I might add.
The problem with the model and the story is that it takes some effort to get a complete overview of the model vs referencing a qtly report and lets face it, the majority of people just jump straight to a qtly report - if they don't like what they see, they move on. The only exception here is if there is clear visible growth, a hot sector or the lemming effect.

I'd also disagree with your comment that "most of these guys are experts that do this for a career". There are far more retail buyers than there are broker houses / professionals and especially in the penny stock end of town.

At first glance, BRK is a loss making oil / gas producer with minimal cash and some land they hope to sell for more (minus 25% to Black Mesa) - this is what the majority of the market sees as per the feedback received.

What also isn't clear at first glance is:

- BRK know there is oil and gas in the ground they lease based on historical and geo data in the area + estimated flow rates (low risk).
- How forced pooling works and how acreage quantity can jump with the process.
- Why another oil and gas company wouldn't just do what BRK are doing themselves - ie: Why would anyone buy from BRK?
- Why pay Black Mesa 25%?
- The DJV is not BRK debt.
- Not a wildcatter - BRK's 100% strike rate on wells.
- The benefit of the small WI's in providing more data.
- The past (recent sales) of land in the area indicating a massive uplift in prices vs BRK original acquisition price translating to increased asset value.

And the list goes on...

I agree with you that the market does not always make sense though and you cannot rely on fundamentals alone. The upside with BRK is they plan to sell or be bought out so it does not matter if the market never recognises the value - upon sale or merger, shareholders will receive true value (or at least, much closer to true value vs the current SP)

Glad to have you on board though - you have timed your entry perfectly.