The present stock price shouldn't be a surprise. The company hasn't delivered. Approximately one year ago the company did a stock offering at over $3.00 saying the money would be spent completing a 12 well program with the projected production of 3000 boepd to be completed at the end of the the fourth quarter.
The story sounded pretty good. Then they changed the story and when I first heard they were going to buy Origin with the money I bailed at $ 2.70. I never like a story to change without a positive reason and they gave no details. I thought I might re-enter at $ 1.50 if I liked the story. But since they announced the Origin deal, the story has got continually worse. There have been delays in drilling and extended the time frame for the 12 well program. We have six weeks to the end of the1st quarter and 4 wells to go and the Origin deal hasn't closed and no updates or reasons given for the delays.
This is a classic pump and dump stock.
I don't think they have enough money to complete the 12 well program and complete the Origin deal. The declines probably put the oil production at 350 bopd presently. I estimate that approx. 1,000 boepd = $ 1 to the SP anything else is hope. So the SP is worth $ 0.35 - $ 0.40.
I predicted earlier that some of the board would start to resign as they had sold all their stock and options with no hope of recovery. The CFO has left and been replaced by someone from Origin and a board member has left due to health reasons (this is the most widely used excuse). There will be more resignations.
Some people on this board wonder why the stock price is so low. Its because it is warranted.
The company is out of money, has a fraction of the production they predicted, have used extremely bad judgement in buying an asset they can't use because they have little production. In the present market they have no hope of raising additional money. These are all reasons why the SP is where it is and the market has no confidence in management.
The bottom line is the stock is going lower unless they announce a huge hit and that isn't likely. For this company no news usually indicates bad news. I expect that there will soon be an announcement indicating some of the above, however, they have never come clean in the past..
The only thing I wonder about ... do these people really have as poor judgement, poor business sense, poor execution as it appears or was this whole thing set up to sell the Origin assets.... I guess we'll never know.