So I recently recommended WRES and if you followed you made a substantial gain.
So here's the play now, if you have not, take profits.
Now we saw a move from .40 cent to a $1.13. We should now see a 38% retrace to .86 cents. And we may see a 50% retrace to .77 cents.
My recommendation is buy in the range of .77 to .86.
Then you should plan to hold to $5.50 to $6.50 by July 4th.
The catalysts for this move include the end of the loan redetermination, rising oil prices, a rising stock market and positive technicals on the stock.
You might say this move is impossible. We'll see.
Wednesday, March 25, 2009
Wednesday, March 4, 2009
WARREN RESOURCES (WRES) is extemely UNDERVALUED!
Berry got $7.33 per BOE in this environment!
Valuing Wres the same way and using the Q4 BOE, 21.55 million BOE.21.55 x 7.33 values WRES at 157.96 Million.Remove the debt of 108 and you get 49.96 million plus the 30 million cash equals 79.96 million divide that by shares outstanding 58.19 you get a value of $1.37 per share.
But wait, it gets better in my mind. You still have 37.83 million BOE that we all know is there only it can't be pulled without $50/bl oil. So even if you place a very conservative $2.5 on that you get 94.75 million divided by the shares, you get $1.63/ps and that is very conservative so a very conservative estimate on this company is $3 per share.
I believe you can now see why you had the heavy insider buying at $3 a couple of months ago, the company knows in a sale they would get a MINIMUM $3 per share.I believe in a more normal environment with oil above $50, this company would easily fetch $10/boe x the 59.33 million you would get 593.3 million less the dbt of 108 values the company at 485 million or roughly $8 a share.
Based on Berry and even with the environment you can see just how badly undervalued this company is and I am using very conservative numbers to come up with the $3 per share number.
Valuing Wres the same way and using the Q4 BOE, 21.55 million BOE.21.55 x 7.33 values WRES at 157.96 Million.Remove the debt of 108 and you get 49.96 million plus the 30 million cash equals 79.96 million divide that by shares outstanding 58.19 you get a value of $1.37 per share.
But wait, it gets better in my mind. You still have 37.83 million BOE that we all know is there only it can't be pulled without $50/bl oil. So even if you place a very conservative $2.5 on that you get 94.75 million divided by the shares, you get $1.63/ps and that is very conservative so a very conservative estimate on this company is $3 per share.
I believe you can now see why you had the heavy insider buying at $3 a couple of months ago, the company knows in a sale they would get a MINIMUM $3 per share.I believe in a more normal environment with oil above $50, this company would easily fetch $10/boe x the 59.33 million you would get 593.3 million less the dbt of 108 values the company at 485 million or roughly $8 a share.
Based on Berry and even with the environment you can see just how badly undervalued this company is and I am using very conservative numbers to come up with the $3 per share number.
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