EBITDAX is the peer group measurement standard - its what defines the Earnings power of the company's assets, plus of course the basis for most debt covenants. That's what Einhorn is not so impressed by that.
DD&A matters greatly (you're an accountant type guy right). It gets subtracted when real operating earnings are calculated. In the end its Net Income that matters and while I agree the money is spent (and so irrelevant to Cash margin) if you can't eventually get over that DD&A hump then why bother.
Cash margin first (or FFO) I agree, else you go out of business quickly, then Net Income because thats the objective, and then EBITDAX to show earnings capability.
SSN Price at posting:
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