IMAX – To the Bat Cave ! – For Higher Earnings

The Tumbler on the set of The Dark Knight Rises.
The Tumbler on the set of The Dark Knight Rises. (Photo credit: Wikipedia)

IMAX* (IMX : TSX : $23.98 )

April 30

Please read this article with our prior market letters on The Hunger Games , Scholastic and Lions Gate 

Shares of IMAX were weak after the company reported Q1/12 results that were generally inline with expectations.

 For the quarter the company reported EPS of $0.06, The primary driver of the quarter was the markedly strong box office performance in Q1/12.

The total box office was up 95% year over year to $121.7 million. During the quarter, IMAX also completed eight new systems sales. The commercial screen count grew 32% year over year to 510, with the company having another 263 systems are in backlog. 

An analyst with Canaccord  believes IMAX is heading into a period of very high earningsgrowth and is projecting 70% year over year growth in EBITDA in Q2/12 and over 100% in H2/12.

Judging by the early returns in April and the upcoming slate through May and June, Galappatthige’s box office projection of $150 million for Q2/12 looks quite achievable. IMAX indicated that gross IMAX box office to-date in Q2 is up roughly 500% year over year.

Holy Forecasts Batman Fans  !

The release of, and the run up to the new Batman movie “The Dark Knight Rises” could be catalytic for the stock.

 

 

Apprentice Millionaire Portfolio Books and Seminars

Stock Market Learning - Logo
Stock Market Learning - Logo (Photo credit: Wikipedia)

AMP Seminars  are available as fundraisers for Rotary and Chambers of Commerce and will be held in October in Washington D.C. , New York City and Toronto

We would like to offer them in your city.

If  your organization would like to use these seminars as an annual fundraiser please contact / email :

info@jackbassteam.com

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GEVO – Preview Target $16

Description: Chemical structure of isobutanol....
Description: Chemical structure of isobutanol. Author, date of creation: selfmade by Rune Welsh, November 1, 2005 Source: - Copyright: Released to the Public Domain Comments: high-resolution b/w PNG; ChemDraw / Irfanview. (Photo credit: Wikipedia)

Gevo

GEVO : NASDAQ : US$9.82 Buy , Target US$16.00

Q1 preview: looking at Luverne; maintain BUY, $16.00 target

Recommendation

We maintain our BUY rating as Gevo appears poised to meet its isobutanol startup milestones at Luverne and EBITDA breakeven looks to be feasible with just two plants. We find the opportunity compelling while acknowledging the speculative risk profile and Butamax litigation.

Highlights

Gevo will report Q1/12 results on May 1 after the close (call at 4:30pm ET). We model revs/EPS at $16.2M/$(0.55) vs. consensus at $15.8M/$(0.59). As noted previously, we find financial results to be less meaningful than progress vs. key milestones.

Milestone focus remains on the Luverne plant’s transition from ethanol to isobutanol production. Our model currently assumes a sharp Q2 transition and Q3 ramp – assumptions that may need to be smoothed in H2/12 depending on the pace of commercialization.

On the litigation front, we expect to hear an update on Butamax, ahead of the expected injunction ruling (expected any day).

The balance sheet remains in good shape near term (~$94.2M cash as of Q4/11), with additional financing likely a priority in H1/12 ($150M shelf outstanding) to execute the growth strategy across products and partners.

Valuation

We derive our $16 target by applying a 6.7x EV/EBITDA multiple to our ’14 EBITDA estimate of $75.9M, discounted back two years at 20%.

Risks

Executionagainst milestones, commodity cost + price volatility, future fundraising, Butamax litigation

ROVI Corp. Preview Target $ 48

Logo of Rovi Corporation.
Logo of Rovi Corporation. (Photo credit: Wikipedia)

Rovi Corporation

April 30

ROVI : NASDAQ : US$29.26  Buy , Target US$48.00

Q1/12 preview;

Recommendation $48 target ahead of ROVI’s Q1/12 results.

 We continue to believe that ROVI is well-positioned to benefit from current OTT trends and remain confident that numerous growth opportunities not reflected in ROVI’s current valuation exist in 2012 and beyond.

Highlights

The combination of additional segmented data and our industry checkssupports our thesis that ROVI remains a growth company in a growth market cycle.

Macro trends around connected-TV proliferation remain strong, providing ample opportunities for new and expanded agreements.

We believe the recent stock underperformance is related to post-debt raise fears of another acquisition. We adjust our estimates to reflect the additional $500M in debt.

ROVI is scheduled to report its Q1/12 result on May 3 after the market close.

Valuation

Our $48 target price reflects a 16x forward P/E multiple on our unchanged 2013 pro forma EPS estimate of $3.00. We believe that ROVI’s core businesses remain strong. BUY

New Zealand Energy – 2011 Year End / Q4 Results

The Transocean drill vessel, Discoverer Clear ...
The Transocean drill vessel, Discoverer Clear Leader, prepares for drilling operations for the Deepwater Horizon oil response in the Gulf of Mexico, July 9, 2010. The Discoverer Clear Leader, an 835-foot ultra-deepwater drilling rig, can recover more than 15,000 barrels of oil and 30 million cubic feet of natural gas per day with the help of the supply vessel Celena Chouest that provides drilling mud and other material (Photo credit: Wikipedia)

Company News Release April 30

NOTE : This is part of the release – see the company website for the full release . Four analysts have a ” buy ” recommendation on the stock.

New Zealand Energy Announces 2011 Year-End and Fourth Quarter Results and 2011 Year-End Reserves Estimate

FINANCIAL SNAPSHOT

---------------------------------------------------------------------------- For the year ended For the year ended December 31, 2011 December 31, 2010 $ $ ---------------------------------------------------------------------------- Production 11,623 bbl Nil Sales 9,567 bbl Nil ---------------------------------------------------------------------------- Price 106.83 $/bbl Nil Production costs 23.44 $/bbl Nil Royalties 4.96 $/bbl Nil Net revenue 78.43 $/bbl Nil ---------------------------------------------------------------------------- Revenue $ 974,517 $ Nil Total comprehensive loss (6,655,829) (10,338,136) Interest income 119,583 Nil Loss per share - basic and diluted (0.08) (0.24) Current assets 19,293,345 6,229,650 Total assets 31,152,804 6,301,322 Total liabilities 1,383,376 371,958 Shareholders' equity $ 29,769,428 $ 5,929,364 ----------------------------------------------------------------------------

RECENT DEVELOPMENTS

OnApril 24, 2012, NZEC entered into a drilling agreement withEnsign International Energy Services Pty Ltd(“Ensign”) pursuant to which Ensign has committed to drill three exploration wells for NZEC, with the option for up to five additional wells, in the second half of 2012.

OnApril 1, 2012, NZEC commenced continuous production from its Copper Moki-2 well. Copper Moki-2 flowed 14,825 barrels of oil and 15,352 thousand cubic feet (“Mcf”) of natural gas(1) during a 16-day flow test in February and was subsequently shut-in for pressure build-up before commencing production in April. The well is currently producing from natural reservoir pressure out of the Mt. Messenger formation at an average rate of 581 barrels of oil per day (“bbl/d”) and 1,530 Mcf of natural gas(1) per day (“Mcf/d”) through a 24/64th inch choke.

NZEC has drilled five exploration wells in theTaranaki Basin, one on the Alton Permit and four from the Copper Moki pad on the Eltham Permit. Copper Moki-1 and Copper Moki-2 are currently in production. Copper Moki-3 and Copper Moki-4 will be completed and tested in Q2-2012.

Production

NZEC’s Copper Moki-1 well has been flowing from natural reservoir pressure sinceDecember 10, 2011and has produced more than 67,000 barrels of oil since it was first tested inAugust 2011. Production rates have averaged 424 bbl/d and 1,058 Mcf/d(1) since commencing continuous production inDecember 2011. Over the last 30 production days, Copper Moki-1 has produced at an average rate of 309 bbl/d and 1,205 Mcf/d(1) through a 24/64th inch choke.

Copper Moki-2 flowed 14,825 barrels of oil and 15,352 Mcf of natural gas(1) during a 16-day flow test in February and was subsequently shut-in for pressure build-up. NZEC initiated continuous production from Copper Moki-2 onApril 1, 2012. The well is currently producing from natural reservoir pressure out of the Mt. Messenger formation at an average rate of 581 bbl/d and 1,530 Mcf/d(1) through a 24/64th inch choke.

Natural gas and associated natural gas liquids are being flared until the Corporation completes a 2.6-km pipeline and associated production and sales agreements, with the pipeline scheduled for completion by the end of Q2-2012.

Exploration

Copper Moki-3 reached target depth at 3,167 metres in mid-March and is the Corporation’s first well drilled through to NZEC’s deeper exploration target, the Moki formation. After evaluation, the Corporation identified 12 metres of net pay within the Mt. Messenger formation and 15 metres of net pay within the Moki formation. NZEC brought a service rig to site and commenced completion of Copper Moki-3 onApril 25, 2012.

Copper Moki-4 reached target depth of 2,125 metres onApril 10, 2012. After evaluation, the Corporation has decided to perforate and test both the Urenui and Mt. Messenger formations, and will commence completion activities after perforating the Moki formation in Copper Moki-3.

East Coast Basin

The East Coast BasinofNew Zealand’sNorth Islandhosts two highly prospective shale formations, the Waipawa and Whangai, which are the source of more than 300 oil and gas seeps. Within theEast Coast Basin, the following PEPs have been, or are in the process of being, acquired:

In Part

NZEC will complete and test Copper Moki-4 once the service rig has finished completion operations with respect to the Moki formation of Copper Moki-3. If successful, both wells will be tied into the existing production facilities at the Copper Moki pad.

NZEC will shortly begin construction of an approximately 2.6-km natural gas pipeline that will deliver natural gas from the Copper Moki site to a gas production facility. The pipeline is targeted for completion at the end of Q2-2012. NZEC is currently producing approximately 2,630 Mcf/d(1) of natural gas.

NZEC has identified six prospects on 3D seismic similar to Copper Moki, with the expectation of establishing one pad per prospect with two to four wells per pad. NZEC has also identified 12 leads on 2D seismic that will be further defined with the ongoing 3D seismic survey.

With a fully-funded treasury, NZEC is evaluating opportunities to accelerate its exploration program, including drilling additional wells which may target the deeper Tikorangi and Kapuni formations. While previous guidance was for six wells in theTaranaki Basin, NZEC has entered into a rig contract to drill up to eight wells in the second half of 2012. NZEC also has the ability to move quickly should the team identify a strategic acquisition, partnership or farm-in opportunity.

NZEC is completing a 100-km2 3D seismic program over the northern region of the Eltham andAltonpermits. Preparation for the seismic survey is nearly complete and NZEC intends to initiate the 30-day data acquisition process in early May. Following data acquisition, NZEC’s technical team will take approximately four months to process and interpret the data and integrate the information into its technical database. The 3D seismic survey will further define existing targets and reduce drilling risk while potentially identifying new exploration targets and expanding NZEC’s inventory locations for its 2013 exploration program.

 

Dee yje company web site for the full release .

 

MEG Energy – Proving Itself Target $56

 

 

Firebag SAGD Well Pad - Suncor Energy
Firebag SAGD Well Pad - Suncor Energy (Photo credit: Suncor Energy)

MEG Energy Corp.

April 29

MEG : TSX : C$41.97  Buy , Target C$56.00

MEG proved our thesis Thursday that it (along with other heavy oil producers) was poised for a strong rebound, albeit we didn’t expect such strength for MEG in one day.

The company continues to display its strong operations and low cost structure; which was evident in its Q1/12 results as MEG achieved thethird highest netback quarter in its history (~$39/bbl), despite wide heavy oil differentials. With the WCS/WTI price difference narrowing (~15% of WTI), Q1/12 results behind us, and possible organic production upside potential through operational enhancements, (which could yield upside to Street estimates), we believe the stock can continue with its upward trend. .

 

Christina Lake 2B scheduled to add at least 140% to MEG’s notional productive capacity. The construction of the 35 MBbl/d phase is progressing and on schedule for start up in 2013. MEG will look to drive efficiency initiatives to push the production envelope beyond initial design capacity, similar to the 20% exceeded in Phases 1 and 2. Such results would imply that Phase 2B could produce close to 42 MBbl/d, which on that basis alone would mean a 5% increase to our estimated NAV for the MEG vs. only the 35 MBbl/d design capacity.

 

MEG’s non-condensable gas and infill well pilots exhibit potential for even further production upside. The company tested non-condensable gas on three well pairs and saw a 25% reduction in steam requirements (vs. the anticipated 10-15% seen before), thus providing the opportunity to re-deploy the steam elsewhere (in this case likely to infill wells).

The two infill wells at Christina Lake achieved production of ~400 Bbl/d each with a cumulative SOR of ~ 1.0x at the end of March. MEG is looking at the possibility of implementing these initiatives across Phase 2B, which brings the possibility of even further upside to the 42 MBbl/dtheoretical production capacity we mentioned above. Assuming there will ultimately be one infill well per two of Phase 2B’s 42 SAGD wells, and each infill well is able to produce 200 Bbl/d, that would imply an incremental 4.2 MBbl/d of  production, or another 12% increase to the design capacity.

TARGET PRICE  $56

$56 target is based on 1.2x our estimated risked NAV. The premium multiple  reflects the top-tier asset and operatorship, potential operational upside and the relative premium the market places on the company. Shares are currently trading at $1.28/estimated recoverable bitumen

Junior Gold Producers On Sale – Accumulate

one oz. Proof U.S. gold bullion
one oz. Proof U.S. gold bullion (Photo credit: Wikipedia)

 

 

ATNA RESOURCES (T-ATN) $1.17 +0.09

 

BELO SUN MINING (T-BSX) $1.06 +0.06

 

SILVERCREST MINES (V-SVL) $2.29 +0.12

 

” Sell in February and run for the nearest bomb shelter” . It has been a truly ugly last couple of weeks where we have seen some absolutely enormous sell offs.

 

Now volumes remain light, but one wonders if we aren’t seeing some bottoms…or maybe we are just being too hopeful. As far as the precious metal sector, there’s three stories :

As far as what is going on with gold right now,Silver is down 35%, the senior mining indices 25%, juniors 46% while gold is up 5%. The relative strength of the mining shares to the gold bullion price is at extremes only seen five times in the past one hundred years. This is clearly an attractive time to be accumulating positions.” 

 The weekly charts of the mining indices are producing the most oversold readings since November 2008. The first week with a higher close would indicate that the downside momentum has come to an end. While there could be a re-test of support as experienced in 2008, we’ll look for the 50-week exponential averages to provide the first significant resistance.

 

 “Following the breakout of the descending triangle, Gold bullion has flirted four times with the 61.8% support (1625) of the December through February rally. A close through $1690 on expanding volume would suggest that a base in nicely in place.”

Meanwhile, look at the charts folks. As we’ve mentioned, those are horrendous corrections for stocks from Atna Resources and SilverCrest Mines.

 

 

Atna Resources

 

On the Atna story, analyst  – We believe Atna has the potential to expand its Au production from 33,000 oz per year to over 150,000 oz per year by 2014, based largely on its ability to fast track the Pinson Gold project to production. We continue to model Pinson production ramping up from 47,000 oz Au in 2013 to 87,000 oz Au in 2014, averaging 82,000 oz LOM.”

 

“We expect relatively low capital requirements to expand production at the Atna operations. As such, we expect low capital risk and significant free cash flow as Briggs expands in mine life, and Pinson  advances to production in H1/13.”

 

Belo Sun, just announced new resource numbers and there simply aren’t that many good five million ounce gold deposits around. He suggests it is in an excellent location in Brazil, feasibility study to come, potential for many more ounces to be added and it remains a top pick.

 

 SilverCrest Mines

Once again, ugliness. Dropping from nicely over $3.00 to $2.00.

On April 20th, SilverCrest announced updates on Q1 production and analyst 

“SilverCrest reported Q1 production of 134,528 ounces of silver and 9,405 ounces of gold, significantly outperforming our forecast for production of 107,814 ounces of silver and 7,444 ounces of gold.

 

 “SilverCrest re-iterated its guidance for production of 435,000 ounces of silver and 33,000 ounces of gold in 2013. We believe that the company

is being conservative. We forecast production of 35,000 ounces of gold and 605,000 ounces of silver.”

 

 

The start of better times-  we wonder – what do you think ?