Brand value? Tarnished.
Use of new technology to disrupt? Not obvious and not declared in the strategy.
Sympathy/spillover effect on valuation? If anything commodity companies are out of fashion. Gives potential unlocked value.
Potential sector or index selling? No way to monitor this yet.
Under/over-reaction to news?
- CEO stated might never return to profitability or positive cash flow
- Potential default on senior debt of $2b, bond holders hedging with stock
- Potential short squeeze on debt holders at low P/B ratios
- Short squeeze timeframe: 1w to 1m
- 90% from energy, 10% hard commods ($1.50 per share in hard commod revenue)
- Net assets after liquidation of roughly $0
- Burning $0.50 in earnings every 6 months
- If they sell oil business and are left with 6b of revenue, 5% profit margin, 5x EV/EBIT, net cash/debt of 0, equates to market cap of 1.5b USD or US$1.15 per share, S$1.57
- Results after selling oil businesses