Amedeo Res Share Discussion Threads

[howdlep] 08/8/2016 14:05

Yes its hard enough buying stock now. Try buying any on a new rig order, when there will be a huge gap-up, up-ticks with each buy, a lot of which will be premium buys.

Definitely one to have a core and trading holding imo.

[oilbuy] 08/8/2016 14:00

Good old creon resources !

[oilbuy] 08/8/2016 13:59

I do indeed. Sold within a few mins. It went nuts on every buy. My only concern is the delay. Hope it hasn't cost us profit !

[howdlep] 08/8/2016 13:54

Difficult to acquire stock now. NMS of 4000

[howdlep] 08/8/2016 13:53

I agree entirely.

Remember, remember the 2014 intra day spike over 3p (pre 100:1 consolidation equivalent of 300p) on speculation of further rig orders?

Once we get Explorer 1 rig delivery RNS, what price a new order, given quality proven?

[oilbuy] 08/8/2016 13:43

A good RNS will see us multiples of today's market cap. Tight as here !

[howdlep] 08/8/2016 12:22

We await the imminent arrival of that rig delivery RNS.

MGR well positioned for future profits.

Plenty of cash on the balance sheet for acquisitions.

Next stop MA200 at c14p. Premium buys likely, as volume picks up for an illiquid stock (free float 19% after four major shareholders), where acquiring stock is very difficult. However, it will be far more difficult when the stock gaps up with that RNS.

[oilbuy] 08/8/2016 12:05

Little bit of volume today. New imminent. Have we made a profit ?

[davethechef] 05/8/2016 10:27

Continued Iron Ore price recovery & outlook,is positive for our JV partner- MGR Resource's revenue, especially since start of this year; should be reflected in Interim Results, likely end of September.

Recent articles,

[howdlep] 02/8/2016 11:25

Two trades, two up-ticks. A highly volatile share, as the free float outside the top four shareholders, is only 19%,

We await the rig delivery RNS and further addition to an already very healthy cash balance.

Now what if we were to obtain a new rig order or invest/acquire another business?

Market cap @ 10.25p is only £3.3m

[howdlep] 15/7/2016 09:47

Now at yesterday's intra day high and ready to move higher, towards that MA200

[howdlep] 15/7/2016 09:07

Looking for a break and hold above MA200 today. Each decent sized trade likely to move the sp, given the tiny free float and likely news pending re the delivery of the rig:-


free stock charts from uk.advfn.com

[oilbuy] 14/7/2016 11:23

10 /12M shares free float !

[genises] 14/7/2016 10:12

Free float has always been very tight what's the amount in public hands oilbuy

[oilbuy] 14/7/2016 10:08

A new rig contract would create a multibagger.

[genises] 14/7/2016 10:04

Interest to see sudden buying.
It we be interesting to see if potential clients who have visited the rig will turn into orders.
Negotiations are ongoing

[oilbuy] 14/7/2016 09:55

Agree with all the above. My concern is our profit margin on our first jack up due to delays. We all know what happened when we were creon resources.We multibagged on news of new orders. 450% in one hour !

[knicol46] 14/7/2016 09:32

14p coming up at this rate, only 4 mm's controlling this stock, awaiting news

[apfindley] 14/7/2016 09:15

GWMO looking good still £1mill market cap copper-gold explorer with a massive license area in nevada, with highly visible mineralisation. Multibagger coming as they're just starting to drill. Copper at just 2 of their many finds is stated by the ceo to be worth $200mill each.Get in before the crowds before it multibags.GWMO boooooooom time

[knicol46] 14/7/2016 08:54

last traded +11%, on the move, well undervalue on current assets + cash

[howdlep] 13/7/2016 15:03

With a declining oil price the market had been pricing no further orders. However, with Yangzijiang Shipbuilding picking up further orders, their order book looks very healthy. Now we just wait for our JV (with them) to pickup a new order, for which I have disclosed the WH Ireland detail above.
In the meantime, expect the rig delivery any time soon, following its international testing.
Potential new customers will have had the opportunity to view the finished product

[oilbuy] 13/7/2016 13:41

Delays cost money. My concern will be that the profit has been eaten into. Has anybody got an opinion on this ?The market cap was £28 mil just after the land was purchased. Why are we below £4M now ?

[howdlep] 13/7/2016 13:26

This taken from the June 2015 detailed note:-

Note, other brokers will have lower valuations. A lot will depend on order timing, applicable margins, MGR trading, further (positive) investments and general markets.

(Note also, obviously all references to share price and earnings relate to BEFORE the 100:1 share consolidation which took effect 1/7/15, so multiply all references by 100).

Detailed report begins:-
Amedeo Resources is a resource and energy related infrastructure and asset investment company. The Group benefits from a management team with a proven track record, a strong senior partner in its first major investment with Yangzijiang Shipbuilding, in combination with the Qatar Investment Authority as the majority shareholder. Amedeo’s associate, YZJ Offshore, received its first order in 2012 for a Le Tourneau Super 116E Class design jackup rig, which is scheduled to be completed in late H2 2015. Amedeo also owns a stake in a small commodities trading business, MGR, and we anticipate further investments to be undertaken in due course. Whilst the market backdrop has become more difficult following the decline in the oil price, and this is still a relatively early stage in the Group’s development, the medium-term growth potential for Amedeo’s key investment in YZJ Offshore is significant. We initiate coverage with a Speculative Buy recommendation and 0.75p share price target.

----

PER We have constructed a peer group comprising the London listed oil services businesses, with the addition of the two main Singaporean rig builders, Keppel Corporation and Sembcorp Marine. Following the decline in the oil price and subsequent impact on sector valuations, the peer group currently trades on a

FY1 PER of 13.5x falling to 12.6x. On EV/EBITDA criteria, the multiples stand at 7.8x falling to 6.4x.
However, Amedeo is in its infancy with only one investment and with the profit coming from YZJ’s first rig expected to be lower than for future projects. In arriving at our fair value estimate for the shares, we assume that a 15% operating margin is achieved on each future order constructed (whether it be a rig, an accommodation deck, vessel etc) and that the average order value is US$150m per order. This would imply an operating profit of US$22.5m per contract, US$4.3m/0.08p per share of which would be attributable to Amedeo shareholders.
Assuming two major contracts are delivered in FY 2018E and that MGR pays a dividend and interest to Amedeo equal to the Group administration costs, this would result in a hypothetical EPS of 0.17p. Ascribing a conservative PER multiple of 6x, a 52% discount to the year-2 peer group PER multiple, this would imply a share price of 1.0p.

[davethechef] 13/7/2016 13:23

From the 8th July, an analyst 12month forecast of 75p!

[howdlep] 13/7/2016 13:10

and of course WH Ireland, in last years detailed note, were speculating on far greater margins in future orders. So based on an order contact of $150m, a margin of 15% and AMED's 19% JV share, that would mean to AMED:-

$150m x 15% x 19% = $4.275m

against a current market cap, at the current 10p, of £3.3m

now add in the cash on hand as of 14/6 which was $4.152m and the remaining money owed by MGR of $400k and you can see how massively undervalued AMED is.

We now await the rig delivery RNS and watch for any further speculation of a new big contract which would totally transform the share price by a multiple of the current price.

Note, there are CEO options at 100p!