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Manitok Energy (V.MEI) is 'undervalued and poised for appreciation,' new report says

Stockhouse Editorial
1 Comment| July 4, 2014


The recent rally in the price of Manitok Energy Inc. (TSX: V.MEI, Stock Forum) shares continued Friday as the stock gained another 2.7% to $3.01, leaving a market cap of $211 million, based on 70 million shares outstanding.

At current levels, the stock is up smartly from $2.20 in mid June, 2014.

The move comes on the heels of a bullish report that was posted on the Seeking Alpha website. It describes Manitok as “highly undervalued and poised for price appreciation.’’

Manitok Energy is a junior producer of conventional oil and gas with operations in Alberta, Canada. The company’s primary focus to date has been on the Stolberg structure in the Alberta Foothills, a liquids-rich natural gas play.

Manitok has clearly proven that it is adept at operating in this area and its production and cash flows are growing significantly as a result, according to the Seeking Alpha report, which makes the following key points:
  1. Manitok is a highly undervalued junior oil and gas company and has well over 100% 6-12 month upside and even higher upside longer term.
  2. The stock is undervalued relative to its peers by 125% based on EV/EBITDA, 155% based on EV/Production, and 100% based on EV/IP proven reserves, and trades at 2.87 x Q1 2014 annualized cash flow.
  3. Exceptional continuing growth with a debt/cash flow ratio of 0.4 in Q1 2014 and a stated corporate goal of maintaining debt to cash flow less than 1.25x.
  4. Affirmed guidance on June 19 of annual production increases of +48% and funds from operations of +68%, yet it still trades at an irrational discount to peers.
  5. Due to positive drilling results released last week, it’s extremely likely Manitok will hit year-end guidance, causing much of the large discount to unwind.

FULL DISCLOSURE: Manitok Energy is a client of Stockhouse Publishing.


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Comments

BaystreetBenny
Watch RPX Just Raised $3M @ $0.055 a few weeks ago....Traded Million @ $0.015..Crazy ! Drills programs Underway....Drills Turning on Massive VMS property Near KIDD Mine Area Near Timmins ONT
1.5 stars
July 6, 2014
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