Q: with the sale of a 40% working interest for $ 150 m and growth plans and buying back shares and insiders owing a lot is this worth buying.
5i Research Answer:
Considering market cap of $229M and enterprise value of about $300M, a sale of $150M is nice. GASX also retains a 32% working interest in the project. The revenue base remains fairly small, and cash flow so far has been minimal. But with an improved balance sheet and an expected first profit this year, investors may start to pay more interest here (it is down 19% YTD). Offsetting this are its small size and the sector outlook, which is hardly robust right now. Insiders own 15%, Lutry Investments own 18%. We would consider it 'OK' right now but not hugely compelling. We would like to see cash flow improve and what plans it may have with its newfound capital.