Haywire
from JB Were, as I am a client.
and here is an extract from a UBS report dated 5.2.10 at whch time I think the sp was 0.50.
"UBS Wealth Management Australia
ROC Oil Company Limited
After the major Basker Manta reserves driven correction Roc rates as a Buy
The biggest underperformer in our E&P coverage universe�
Roc has been the biggest underperformer in our E&P coverage universe, down 44.7% over the last six months. This compares to the performance of the S&P/ASX200 Energy Index which is down 3.7%, and the S&P/ASX200 Index which is up 7.2%, over the same period.
� but for a reason
Roc has undergone a major share price correction (down 35%) over the last two days from the unexpected 80% downgrade in Basker Manta (Roc 30%) 2P reserves. In addition, severe winter weather and technical issues (electrical fault)
have also adversely impacted Roc�s oil production in China (Zhao Dong).
Roc looks cheap relative to its peers
Roc looks cheap relative to its peers based on our valuation of Roc�s operating assets (refer: UBS Oil weekly) and is now trading at a 32% discount to our NAV.
Roc is implementing a strategy to strengthen it's balance sheet and right size the business. Exploration activity is to pick up over 2010, but from a very low base.
Valuation: A$0.57 DCF at 10%
Our ROC NAV/share estimate is based on a DCF (10% nominal discount rate) of forecast cash flow over the 2P reserve life of producing assets and all committed and highly probable projects. Our price target of A$0.57 (prior A$0.94) is based on our NAV estimate."
Regards
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