Geopark is a firm that was build on the principles of buying assets that other saw as to risky. The company has executed perfectly and the management team is great. I very much like the stock. Parex too, but it’s listed in Canada and Im in Germany. This means that I would have to pay a total tax rate of 50% (!) on dividend and capital gains. I haven’t looked at Pampa yet.
Only concern is Petro, the Leftist President of Colombia who seems like a true believer, and the messes he might make there... Of course, Latin America is always like this and the pendulum usually swings back in the other direction (except of course in Venezuela, Nicaragua and Cuba) - Petro will probably scare foreign investors away from Colombian stocks... Had done this piece last year: Global X MSCI Colombia ETF Holdings (September 2023) https://emergingmarketskeptic.substack.com/p/global-x-msci-colombia-etf-holdings-sept-2023
This has changed a lot IMHO. Now Colombia is willing to drill for more oil and Petro doesn’t have the support he needs anymore. No doubt, it’s still Colombia! But the risks are not as big in my opinion.
Had noted this messy situation though: "GeoPark’s two founders had a messy falling out in 2021 with the ousted Chairman and Company making various claims or statements about each other."
Thanks for the article! I own Parex, but decided to add GeoPark too after doing some high level research.
As for valuation, how did you arrive at 3.7x EV/FCF (based on Q1 2024 annualized)? Q1 OCF = $88mn, Capex = $49mn => FCF = $39mn or $155mn annualized. EV is $925mn, so EV/FCF = 6.0x. But maybe I'm missing something.
Prefer Parex with complete focus on colombia and for Argentina, Pampa energy.
Geopark is a firm that was build on the principles of buying assets that other saw as to risky. The company has executed perfectly and the management team is great. I very much like the stock. Parex too, but it’s listed in Canada and Im in Germany. This means that I would have to pay a total tax rate of 50% (!) on dividend and capital gains. I haven’t looked at Pampa yet.
Only concern is Petro, the Leftist President of Colombia who seems like a true believer, and the messes he might make there... Of course, Latin America is always like this and the pendulum usually swings back in the other direction (except of course in Venezuela, Nicaragua and Cuba) - Petro will probably scare foreign investors away from Colombian stocks... Had done this piece last year: Global X MSCI Colombia ETF Holdings (September 2023) https://emergingmarketskeptic.substack.com/p/global-x-msci-colombia-etf-holdings-sept-2023
This has changed a lot IMHO. Now Colombia is willing to drill for more oil and Petro doesn’t have the support he needs anymore. No doubt, it’s still Colombia! But the risks are not as big in my opinion.
Had a good profit with Pampa, but sold it a year ago.
That’s great, Antonius. We are looking forward to your full write-up.
Personally, I favor Sintana Energy…and that’s a very different risk profile.
https://jaminvest.substack.com/p/odd-lots-4-sintana-energy
https://jaminvest.substack.com/p/odd-lots-5-sintana-energy
Just saw your post and I linked to it in my links post for today: Emerging Market Links + The Week Ahead (June 24, 2024) https://emergingmarketskeptic.substack.com/p/emerging-markets-week-june-24-2024 I did a piece about them last year: https://emergingmarketskeptic.substack.com/p/geopark-ltd-latin-america-oil-boom/comments + https://emergingmarketskeptic.substack.com/p/vista-energy-largest-non-na-oil-gas-shale-play/comments
Had noted this messy situation though: "GeoPark’s two founders had a messy falling out in 2021 with the ousted Chairman and Company making various claims or statements about each other."
Thanks 🙏
Thanks for the article! I own Parex, but decided to add GeoPark too after doing some high level research.
As for valuation, how did you arrive at 3.7x EV/FCF (based on Q1 2024 annualized)? Q1 OCF = $88mn, Capex = $49mn => FCF = $39mn or $155mn annualized. EV is $925mn, so EV/FCF = 6.0x. But maybe I'm missing something.
It was price to FCF 🙈
I did a short piece about them last year: https://emergingmarketskeptic.substack.com/p/geopark-ltd-latin-america-oil-boom/comments and had noted this messy situation though: "GeoPark’s two founders had a messy falling out in 2021 with the ousted Chairman and Company making various claims or statements about each other..."