I will never go long Maverick. For me an investment in a junior oil and gas company requires a combination of (1) good management and a (2) good assets.
1.) I have grave misgivings about the following: http://www.sec.gov/litigation/litreleases/lr16042.txt
2.) As I have documented in several earlier posts their core reserves seem far too high to me. In addition to the data available on the Texas RRC website if you have access to a subscription service such as IHS you can access the producing wells by lease and water production. I have posted my interpretation of that data and I don't find it consistent with the stated reserves.
3.) High impact wells are indeed a curve ball which I find hard to evaluate but given I don't like 1 or 2 it is unlikely that there would be a sufficiently compelling story to overlook these. From a conventional perspective Texas has been extensively picked over, there are indeed highly economic discoveries still being made but they are generally quite small in nature, I am also concerned than the return when you include all the exploration costs to find them is not that good. MAD may yet prove me wrong, there has been lots of excitement about the high impact results so far, will be interesting when we see some sustained flow rates.
FDM Price at posting:
67.5¢ Sentiment: Sell Disclosure: Not Held
