Isn't VET also natural gas play? I am assuming this one has higher torque due to the small size. How would you split allocation if one were to basket these two for NG play?
Yes, VET is also exposed to natural gas, moreso now after the recent acquisition. PHX has upward momentum, a rare thing in oil and gas spaces. VET is still mostly a falling knife. I value insider buying very highly, that's something VET doesn't have. I would be happy exiting VET on a high enough bounce and never look back. Over time if I can find enough companies where management is actively buying in, I'd prefer the incentive alignment. But VET is much cheaper on a lot of metrics.
I miscalculated the management buying shares in TCS, so not sure if they themselves fully understand their business. PHX is in small cap territory so is there a risk of going 0? With VET they are CF positive and have plenty of options before going BK
Yeah, insider buying isn't a cure all. But mineral rights companies have very low cost structures typically. PHX lost money in 2019 because they still had working interests. Since then they divested most working interests in favor of pure mineral rights.
ARLP is good for thermal coal for electricity, but their mineral rights are permian focused, which is oil instead of natural gas. Still a fan of ARLP, but not a natural gas theme.
Curious, what are your thoughts on PHX running a strategic alternatives process and the whole WhiteHawk thing?
A lot of energy companies want to go private or consolidate. The public markets aren't willing to bid them up.
Isn't VET also natural gas play? I am assuming this one has higher torque due to the small size. How would you split allocation if one were to basket these two for NG play?
Yes, VET is also exposed to natural gas, moreso now after the recent acquisition. PHX has upward momentum, a rare thing in oil and gas spaces. VET is still mostly a falling knife. I value insider buying very highly, that's something VET doesn't have. I would be happy exiting VET on a high enough bounce and never look back. Over time if I can find enough companies where management is actively buying in, I'd prefer the incentive alignment. But VET is much cheaper on a lot of metrics.
I miscalculated the management buying shares in TCS, so not sure if they themselves fully understand their business. PHX is in small cap territory so is there a risk of going 0? With VET they are CF positive and have plenty of options before going BK
Yeah, insider buying isn't a cure all. But mineral rights companies have very low cost structures typically. PHX lost money in 2019 because they still had working interests. Since then they divested most working interests in favor of pure mineral rights.
Love the poem! So true!
I was just reading your piece on ARLP. May it be the less degen way to play NG?
ARLP is good for thermal coal for electricity, but their mineral rights are permian focused, which is oil instead of natural gas. Still a fan of ARLP, but not a natural gas theme.