Friday File: VIC Impressions, Altius, Seadrill and “How to make Netflix pay YOU ‘Internet Royalties’ for EVERY movie it rents”

Checking up on some personal holdings and solving a teaser from The Wealth Advisory

By Travis Johnson, Stock Gumshoe, September 12, 2014

I always get a lot of food for thought when I go to the Value Investing Congress, so I’ve got a teaser solution and some updates for your Friday File enjoyment but I thought I’d start with some musing about the Congress ideas that percolated to the top for me on the train ride home…

Mart Resources (MMT in Toronto, MAUXF on the pink sheets) is the one that’s stickiest in my brain at the moment. It strikes as the most timely given the imminent tie-in of their new pipeline (which, they announced yesterday, has been delayed slightly by rains and by “local community complications” but is now on track), which Tim Eriksen sees as bring a huge benefit to them in increased production capacity and theft reduction. I have not run down the numbers yet, but Eriksen has and puts together a pretty compelling (numbers-based) scenario for a worst case of tripling quarterly earnings over the next year and a best case of quintupling earnings thanks both to the new (higher capacity and lower theft) pipeline and to more infill drilling and horizontal drilling in the field, which has been a very steady flower with low production declines.

Of course, the company has disappointed before — but there’s a pretty good sense that it looks like they really are at a substantial inflection point with the continued success of their drilling in this highly productive field, including horizontal drilling (not fracking) and the dramatic improvements made possible by their new pipeline that’s about to open, I’m awfully tempted on this one but want to do some more research before I get all hot and bothered. It is, of course, Nigeria, and it’s a small company partnered in with locals, and it’s an oil driller, and they’re awaiting a construction contract, so it should be cheap. But should it be this cheap? I’ll let you know how my thinking evolves on this one. Don’t drive the price up while I ponder, please.

The other one that’s sticking with me right now, not having dug through all of the presentations and read the company filings for all of these ideas, are the Comcast ZONES securities described by Michael Kao — one tranche of them trades at ticker CCZ, and they are complicated but essentially now represent a 15-year bond that should be trading similar to Comcast bonds ...

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