Diversified Energy Share Discussion Threads

[johnhemming] 14/9/2021 07:06

I have always thought that there was an argument for swapping Oaktree's interest in the various fields into DEC equity at a good price (the price is too low for that at the moment).

[redtom1] 13/9/2021 18:07

Regarding a placing, unfortunately there is every possibility that it will happen. To say it won't is crazy given the recent past and the stated future intentions.

The company surprised us in May with a $180m placing when it didn't necessarily need to do it. So a repeat is possible but maybe not probable imo. I accept that they did it then so that the company (together with Oaktree) could fund a bigger acquisition without needing a 2nd placing/rights issue. Equally, that placing was not well received which could put them off a 2nd time. There is the alternative of a rights issue (which is better for existing shareholders) but I'm not sure about that option as it is more long winded and complicated verses a quick placing.

But the problem I see is that Rusty has said on the record that he wants the Co to be between $2bn and $3bn market cap by half year next year (ie within 10 months) such that it is the appropriate size for a dual listing.
We're about 50% short of the minimum of that valuation (ie we would need an share price around 160p) based on current share cap.
Are we going to get there without raising further equity? Would love to think so but I doubt it. Recent acquisitions didn't increase market cap (other than the $180m placing) so future deals (funded by debt) may not either.

So someone please tell me how we get to a market cap that is virtually double what it is today (taking the middle of the range)?

[cassini] 13/9/2021 17:30

You guys get a room... ;0)

[fardels bear] 13/9/2021 16:54

Wherever I feel it's needed.

[gary1966] 13/9/2021 13:01

NGAS price on the move again all of a sudden.

[lord gnome] 13/9/2021 09:22

Slight error in the Shares article. Dividend is not paid in dollars. Declared in dollars but paid in Sterling to UK holders.

[redtom1] 10/9/2021 20:40

Short but decent article

[someuwin] 10/9/2021 19:49

This week's Shares Mag

[sunbed44] 10/9/2021 17:44

What would the point be of a placing while paying a dividend? Just aint going to happen unless they halt dividend and still need more.

[1knocker] 10/9/2021 17:27

I don't like placings. A rights issue is fairer to the shareholders.

[sunbed44] 10/9/2021 16:37

Solid run since ex-d date. Did not come here for capital growth especially with the hedged situation but I think we may see 130 again along with growing distributions. Happy as Larry here as I grow my position although I did take a bit out to add to ZPHR. My main one though by a mile is SAVE and cant wait for it to come out of suspension when the ExonMobil RTO completes and maybe by end of September.

[redtom1] 10/9/2021 16:09

Gary,
I agree with you but perhaps there will be a placing before a US listing as Rusty implied that he only wanted a US listing when the market cap is greater than $2bn. Obviously I hope we get to the $2bn with natural share price increase but not sure if we will.
Personally I'm not sure why $2bn is held as a threshold. Sure, you need liquidity but surely a $1.5bn company is much the same? Hopefully there will be more about this on 6th October.

[gary1966] 10/9/2021 16:03

Listing in US does not require a placing to happen. Instruments will be set up with existing shares.

[fardels bear] 10/9/2021 13:31

Then you are overweight and that's never a sensible option.

[lab305] 10/9/2021 13:28

scrawl I wholeheartedly agree with your comment on the placing and the headline numbers. Contrary to what some may think on here I am a very large holder of these and the placing day cost me £70k . Obviously therefore I was not over enthusiastic about it and unlike others am not wearing rose tinted spectacles. The latest acquisitions however have been well received and as I commented earlier gain universal broker approval. Its just bloody annoying when in February and March the shares were finally doing well again after two years of waiting .

[scrwal] 10/9/2021 12:49

I think the market is still spooked about the snap placing and also given the aim to have a dual listing means another placing albeit in the US but at what price level. Private investors may be put off by the high yield and the "book" losses re the hedging.

The hedging policy is spot on and will give the company an edge in later years because the non hedgers will get big profits now but immediate losses when the gas prices fall - DEC on the other hand will benefit from the fall as their output is hedged at higher prices which gives time to assess the situation and gives opportunities to buy cheaper assets as the non hedgers may start to sell theirs since they may need funds to cover their losses as prices fall.

[timchecco] 10/9/2021 12:47

"Diversified Energy Company Plc DEC.L : Peel Hunt initiates with buy rating and 160p PT"; Natural gas price is flying; shareprice is back to placing price after 3 and half months; divi is coming...

[bountyhunter] 10/9/2021 12:47

You won't be able to generally speaking unless you have a premium account.

[timchecco] 10/9/2021 12:21

How do I upload a picture here?

[gary1966] 10/9/2021 10:24

As I said previously, if they have enough production hedged already in 2022 to cover dividends, loan repayments etc then I would be happy for them to take market prices on the rest. If they have a bumper period of high prices then happy for every extra cent going towards blitzing debt well ahead of time, rather than an increase in dividend, to set the company up for when prices turn lower at some time in the future and expand production rapidly.

[podgyted] 10/9/2021 10:12

* Diversified Energy Company Plc DEC.L : Peel Hunt initiates with buy rating and 160p PT

[1knocker] 10/9/2021 09:27

Every board has one, just as every board has a 'phantom downticker'.

Actually, I like to see the odd moaning post. Quite often I find that the aspects complained about are the very reasons why I hold the shares, or are at least inevitable consequences of the factors which make the shares attractive to me.

Also, all boards are inevitably somewhat biased to the bull case, because only those who hold or contemplate acquiring shares in the company (i.e. those who see merit in the investment case for the company)follow and post on the board. So the naysayers provide a bit of balance, and remind us that there are no certainties other than death and taxes.

[fardels bear] 10/9/2021 08:59

I see the moaning gis is back