40 -45 $ per Barrel Forecast Y2020 Price Target 3.20 to 4.50

2020년 5월 9일

Bonterra Energy has net debt worth a significant portion of its market capitalization of 33 million$. A primary Red flag for investors. However, The stock is currently trading at 93-94 % below its fair value of approx. 1.1 Billion$, earnings have grown substantially over the past 5 years by over 200%. However, this will be negligible as we forecast earnings and revenue to drop from 189 million Rev/22 Million Earnings (2019) to 135 Million Rev/-20 Million loss of Earnings (2020). This will include the 2000 barrels hedged at 65$ WTI and an average of 37 to 40$ barrel for the remainder of 2020. Break even for Bonterra is set at 24$ WTI barrel (US). However incidentals are likely to raise this number to 27 - 28$ WTI. The company is holding a current debt of $280 Million (Reduced 11% 2019) and interest payments are not well covered by its earnings. Considerations, there is the elimination of its dividend payments, well tie ins and administrative cost reductions that will help to reduce earnings losses (2020). Further reductions in ependitures, Government assistance, administrative and a favorable debt review will see a mid summer high substantially more than its current share price. Subsequent price target of 3.2 to 4.5 per share will still be considerably less than its fair market value pf 15.25$ per share. 3 month price prediction is substantially higher at 2.75 to 3.20 per share from 1.08$ per share, as demand will be returning faster and global outputs falling more than epected.

We do epect Bonterra Energy to make good on interest payments for 2020. WTI oil will be require to average 27-28$ per barrel, with hedged oil. WTI 32-35$ per barrel will be require to break even and maintain growth of 5 - 6% yearly to prevent further cutbacks.

Positive price movement for Bonterra Energy is epected in the near and medium term. We do epect near term accumulation - range bound before breakout. Likely event to occur before months end (June/2020). It appears the CEO, George Fink got carried away paying out Dividend Payments and spending on growth all while not maintaining a balanced budget. However, by 2021 the Alberta government will have additional supply capacity reducing all in cost. Keep an eye on crude prices, specifically 28$ or greater (Bullish); 23$ or Lower (Bearish) WTI.

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