architect, Coastal Energy (CEN.TO) -- thanks for your thoughts and thanks also to Dennis for the CS piece. I'm now the proud owner of some Coastal shares, not a huge amount but ya gotta start somewhere. At this point I'm trying to reconcile the large difference in implied valuation if you look at the cash flow or EBITDA metrics vs. on a 2P reserves approach (cash flow valuation being much higher than 2P reserves valuation). Is that because, at least according to the PE firm certifying the reserves, these wells are expected to deplete very quickly? Speaking of the PE firm, I don't recognize them, do you know much about them? I wonder why Coastal did not go with an easily recognizable name for their PE firm.
Regarding the US listing, even if the exit strategy is a sale to an Asian NOC, I believe they are doing themselves a disservice to pass on getting a US listing. When the acquirers come knocking, if CEN were trading in the US (and thus, IMO, trading at a price that would be at least 30% higher than otherwise), it would make CEN's negotiating posture that much stronger. |
