PSA 0.00% 2.1¢ petsec energy limited

2004 result weighing on sp

  1. 7,537 Posts.
    lightbulb Created with Sketch. 412
    Sellers still in control here.It would appear that the only bearish news about this stock at the moment is the 2004 result.
    The company earned $22.7mil in 2003 and could double that profit in 2005 but the 2004 result is clearly going to disappoint the market.
    I'm currently estimating the 2004 result as a $4mil profit after allowing $11mil for Vermilion DD&A expense but it's anybody's guess how much they'll be forced to amortise the total Vermilion cost of $30mil+ as the official Vermilion reserves as per Ryder Scott were very low in the 2003 Annual Report.
    I would expect that the company will telegraph the result in the upcoming quarterly due to be released at the end of next week meanwhile those sellers want out before then.
    Has to be a buying opportunity for anyone with funds as an historical result based on a non-cash charge doesn't effect the strong fundamentals going forward.But it's a matter of knowing how low the sp will go after the announcement next week.
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.