02-14-2013, 11:27 PM
Great article. I disagree with a few things 1) I think he needs to use a higher discount rate for the discounted cash flow model bc 8.2% for a stock with a Beta of 1.2 is way to low. It should be roughly 10-14%. 2) I think that IOC will receive a higher bid than $1.50 (I'm expecting close to $2) and 3) I believe we will see more cash upfront. From the PRE deal we received roughly $116Mil upfront and the PRE deal pales in comparison to this deal in size. I'm expecting $400-$500Mil upfront with the rest overtime
Once again great article and even using a higher discount rate of 10-14% one can still see IOC is dramatically undervalued and has enormous potential
Once again great article and even using a higher discount rate of 10-14% one can still see IOC is dramatically undervalued and has enormous potential