Donnycreek Energy Inc

DCK-X

0.00
0.00 (0.00%)
This company is not ACTIVE.

Analysis and Opinions about DCK-X

Signal
Opinion
Expert
DON'T BUY
DON'T BUY
March 11, 2014

Drilling results were not stellar and the stock fell about 25% on the day they announced the results. This is a natural gas company with 2 core areas. On the one they have been having good development success. Drilling very expensive wells, but rates of return seem to be very good. Have grown production up to about 1700 BTUs a day so on a run rate basis, that produces about $25 million of cash flow, so the stock is trading at around 4X cash flow. Market was disappointed on the initial drilling results from another area which was an untested Montne trend where they were pushing the fringe of the boundaries. If it had worked, it could have been very, very exciting. They couldn’t test the wells because of the sour contents. This means they need to retest after breakup by bringing on better equipment. Even if they get a productive rate, the cost to produce sour gas is much more than sweet gas, about 4 times. Cautious on the name as the risk is too high.

Drilling results were not stellar and the stock fell about 25% on the day they announced the results. This is a natural gas company with 2 core areas. On the one they have been having good development success. Drilling very expensive wells, but rates of return seem to be very good. Have grown production up to about 1700 BTUs a day so on a run rate basis, that produces about $25 million of cash flow, so the stock is trading at around 4X cash flow. Market was disappointed on the initial drilling results from another area which was an untested Montne trend where they were pushing the fringe of the boundaries. If it had worked, it could have been very, very exciting. They couldn’t test the wells because of the sour contents. This means they need to retest after breakup by bringing on better equipment. Even if they get a productive rate, the cost to produce sour gas is much more than sweet gas, about 4 times. Cautious on the name as the risk is too high.

Eric Nuttall
Partner & Senior Portfolio Manager, Ninepoint Partners
Price
$2.290
Owned
Unknown
HOLD
HOLD
August 1, 2013

Moved sideways in anticipation of the equity issue they did that is now closed. Expensive wells that sometimes disappoint but they seem to have overcome that. Hold because you are in the way of some bigger players. When they prove more they could be a takeover target.

Moved sideways in anticipation of the equity issue they did that is now closed. Expensive wells that sometimes disappoint but they seem to have overcome that. Hold because you are in the way of some bigger players. When they prove more they could be a takeover target.

Bill Bonner
President & Portfolio Manager, Brickburn Asset Management Inc
Price
$1.930
Owned
No
COMMENT
COMMENT
July 3, 2013

Quite impressed with this company. Large land holdings of about 7200 acres in the deep basin. They continue to drill out excellent results out of that play.

Quite impressed with this company. Large land holdings of about 7200 acres in the deep basin. They continue to drill out excellent results out of that play.

Michael Giordano
VP Investments & Portfolio Manager,
Price
$2.150
Owned
Yes
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