the perenial bagger and a challenge

Gee,

I am so happy that I made this week's OGW as the "perenial bagger".

It is also sad to see that a person writing a widly read publication can not see the difference between hype and reality.

PSA may have a "$5 per mcf operating cash margin after finding, developement, and tramsport cost", but sure as the sun rises everyday it doesn't translate into a $5 per mcf valuation in market cap as talked about by TF.

Find me ANY company in the USA or better yet the world that is assigned a market cap value of $5 per mcf as talked about in the article.

Even better yet and much easier, find me ANY company in the ENTIRE world that has a maket cap based upon their "operating cash margin after finding, developement, and transport cost" per mcf......

I'll be waiting a long, long time.

When talking about valuation all one has to do is research the values in buyout tranactions and sales of oil and gas properties to determine what the going rate is.

And it sure isn't the "operating cash margin after finding, developement, and transport cost" per mcf.

I believe that transactions for proven reserves are about in the $2 per mcf range and that is what PSA could expect to get for those in a sale of the company with any small increase or decrease to reflect the particulars of the company.

$5 per mcf?

You gotta be kidding!

Oh, by the way, what are the NET profits after all costs are taken into account for that gas with a discount factor and a profit margin factor?

That is the maximum anyone should pay in a market based transaction.

As shown by PSA's profit results and cash balance the performance to date has been less than expected despite the shareholders being diluted and having their share of the company's ownership beng reduced.

Is PSA a company that is good at finding gas? Yes.

Has it been able to translate that ability into cash on the books? Nope.

Guess who has made the most out of the success? As with most companies, it hasn't been the shareholders.