Saturner, welcome & thanks for your input - good to hear a dissenting opinion as it generates healthy debate & analysis which is what these forums are about ofcourse.
I will reply to your post by addressing each line/paragraph:
You said: "The reports are always favourably worded, and never account for the possible downside risk to 'investing'.
When are any reports NOT favourably worded? Their purpose is to make an investment case for the respective company & are usually commissioned by each company as a way to advertise themselves & highlight their assets to the competitive & crowded marketplace!
The two most recent reports for PVD have done that effectively whilst also highlighting the downside risks (which you claim they don't).
Mirabaud - page 8 & 9 'The potential pitfalls'
"Exploration drilling is not without risk, particularly in a frontier province such as Morocco" etc...
You said: "PVD is in fact one off the most expensive oil stocks that I have seen - at a much higher EV than its peers PCL, JKA, TPT, TAP and FAR".
I own PCL - with an EV around $18 million, yes they are undervalued and I have made this case for PCL numerous times on their HC forum. Sentiment negative as punters think there will be a cash raise soon after costly sunbird well offshore Kenya, plus they lost L8 due to Apache withdrawal & Repsol's dry hole Walvis basin in Namibia, hasn't helped either!
JKA - let's not even go there. Their best potential asset was TPT in Morocco - merger failed - end of story!
I own TPT - their current market cap is around $58 million & PVD's is around $68 million. Most of the cash TPT have is from a recent cap raise which was done to make sure they can cover any costs on their one & only drill in Morocco. PVD have $21 million cash with more ($10 million or so IMO) likely coming from their **on farm-out/s in backcosts. They are more than free-carried for two wells in Morocco next year & their expenditure will be for seismic in Madagascar.
I would argue that PVD's EV is actually less than TPT's due to their superior cash position. I am in TPT for the obvious reason that they are currently drilling & will have decent upside if successful. However, they are a one trick pony & will be decimated (5 cents perhaps) if unsuccessful.
PVD have multiple assets across 3 countries, much bigger targets (Toubkal alone is bigger & with a greater CoS than TAO-1). For every dollar I have invested in TPT, I have 8 dollars invested PVD.
TAP - I can't comment without doing research.
FAR - I own FAR. Your claim that PVD's EV is higher than FAR's is blatantly untrue.
FAR - market cap $107 million with cash after their recent $8 million CR is now approx. $35 million thus EV about $72 million.
PVD - market cap $68 million with cash approx. $21 million thus EV about $47 million.
PVD's Mazagan potential is massive compared to FAR's assets in Senegal & Guinea-Bissau
PVD's Nkembe **on potential is loosely comparable to FAR's L6 in Kenya (although L6 has a larger prospective resource)
PVD's Madagascar asset is loosely comparable to FAR's L9 asset in Kenya - both offshore East Africa - either could be a winner now that BG has de-risked the oil play with sunbird discovery (Madagascar was once joined to East Africa from Somalia right down the Kenyan coast to Northern Tanzania).
FAR's attraction right now is that they are drilling Senegal. For every dollar I have invested in FAR, I have 4 dollars in PVD.
You said: "the last research report issued by PVD also upgraded reserves in **on. What reserves? They haven't found any oil so how can they increase reserves?"
I don't know where you are getting 'reserves' from. All estimates are for unrisked prospective oil resouces with the exception of the Loba discovery in **on which has a mean 20 million barrel contingent resource, yet to be appraised.
As for your mention of Chariot: A quick look shows a market cap of $68 million with $68 million cash - and now have Woodside with them in Morocco. This is stunning if as appears that Chariot is valued at cash only - why is this the case?. If I was in UK I would highly likely be buying up right now.
I suggest that you should try spruiking undervalued Chariot to the unappreciative Poms rather than trying to criticize still undervalued PVD which is on it's way to 80 cents by Xmas/Jan (IMO).
Have a look at the ASX chart for PVD & tell me which way you think this stock is heading!!
PVD Price at posting:
46.5¢ Sentiment: Buy Disclosure: Held
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