Get the Latest Investment Ideas Delivered Straight to Your Inbox. Subscribe


Analyst: Market Undervalues Oil & Gas Firm with Canadian Assets
Research Report

Share on Stocktwits


A Mackie Research Capital Corp. report provided the reasons why the cheap price of this company's stock is unwarranted.

In an Aug. 9 research note, Bill Newman, an analyst with Mackie Research Capital Corp., reported that after having a "solid" Q2/19, Prairie Provident Resources Inc.'s (PPR:TSX) stock is still "incredibly cheap."

Mackie has a target price on Prairie Provident of CA$0.70 per share, which reflects a potential eight-fold gain as the company's current share price is around CA$0.08.

Newman reviewed the energy firm's highlights from Q2/19. Quarterly production was a record high, averaging 6,386 barrels of oil equivalent per day (6,386 boe/day). It also was 24% higher than Q2/18 production of 5,146 boe/day. In terms of average production for 2019, management reiterated its guidance, between 6,100 and 6,500 boe/day.

Also noteworthy, indicated Newman, was that Prairie Provident's adjusted funds flow in Q2/19 was about $6.6 million, which exceeded Mackie's estimate of $5.9 million. It also was more than double the Q2/19 capital expenditures of $3.2 million, which means the oil & gas company is "living within cash flow."

Given its current status and near-term developments, Prairie Provident should be valued higher, Newman purported. For one, it is generating free cash flow. Two, its most recently drilled well at Princess is "highly economic" and could pay out in under 10 months' time. Three, the company is likely to drill two more wells this year. Four, it could have a "cash windfall from the Quebec asset arbitration process," added the analyst.

Mackie maintains its Buy recommendation, Newman wrote, "on the company's long-term growth potential from its large inventory of development oil locations and expanding waterflood programs."


1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures from Mackie Research, Prairie Provident Resources Inc., August 9, 2019

Relevant disclosures required under Rule 3400 applicable to companies under coverage discussed in this research report are available on our web site at

Each analyst of Mackie Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst's personal views and (ii) no part of the research analyst's compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report.

Mackie Research Capital Corporation, its directors, officers and other employees may, from time to time, have positions in the securities mentioned herein.

Bill Newman: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. Within the last two years, Mackie Research Capital has managed or comanaged an offering of securities for, and received compensation for investment banking and related services from Prairie Provident Resources Inc. Bill Newman has research coverage on Prairie Provident Resources Inc.

Want to read more about Oil & Gas - Exploration & Production investment ideas?
Get Our Streetwise Reports Newsletter Free and be the first to know!

A valid email address is required to subscribe