Original-Research: Saturn Oil & Gas Inc. (von GBC AG): BUY

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Original-Research: Saturn Oil & Gas Inc. - von GBC AG

Einstufung von GBC AG zu Saturn Oil & Gas Inc.

Unternehmen: Saturn Oil & Gas Inc.
ISIN: CA80412L1076

Anlass der Studie: Research Update
Empfehlung: BUY
seit: 21.05.2021
Kursziel: 0.46 CAD
Kursziel auf Sicht von: 31.12.2021
Letzte Ratingänderung:
Analyst: Julien Desrosiers; Felix Haugg

Transformative transaction increasing oil production from 350 boe/d to over
7,200

Prime assets with proven low depletion rates. The company is cur-rently
completing the Oxbow assets acquisition, which is located in the Williston
Basin oil field. The company's new inventory will consist of low decline
oil wells with very low gas volumes (5%), thus providing them a stable
foundation to maintain and grow their operations.

Over 2,000% increase in daily boe production. The company pro-duced 375
boe/d before the transaction and will produce just over 7,500 boe/d once
the transaction is finalized. With the increased cash flow and reinvestment
in the field, we expect the company to be able to maintain post transaction
production levels for at least 24 to 36 months.

Lean and cost efficiency structure. The company will scale up their
operations by a significant magnitude to accommodate their increase in
production. Being a larger producer, the company will benefit from possible
economies of scale and we expect them to maximize the Ox-bow assets with
the same efficiency as their other assets.

Pipeline to international markets. In a time of struggling transportation
capacities in Canada, Saturn will acquire multiple pipelines and facili-
ties that will allow them easier access to the international market.

Significant reduction in debt leverage of the company. These assets will
generate a massive positive cashflow for the company, which will allow them
to maintain current oil production levels and initiate an ag-gressive debt
pay-back program.

From net loss to a 53.21% positive Margin. Following the completion of the
transaction, we forecast that the company will achieve revenues of over
$146M CAD in 2021 with an EBIT margin of 53.21%.

Hedging to secure the future. The company have entered into hedg-ing
agreements of up to 85% of their declining production acquired with the
Oxbow assets, thus securing debt repayment for the next 3 years.

Asset's integration. We expect the company to add key members to their
executives and board of directors. This will strengthen their gov-ernance
and ensure a smooth transition from a junior oil company with $7,549M CAD
revenues in 2020 to a major player in SE Saskatchewan with over $146,580M
CAD in revenues in 2021e.

Based on our DCF model we have determine a price target of 0.46 CAD per
share

Die vollständige Analyse können Sie hier downloaden:
http://www.more-ir.de/d/22491.pdf

Kontakt für Rückfragen
GBC AG
Halderstraße 27
86150 Augsburg
0821 / 241133 0
research@gbc-ag.de
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Date (time) of completion of English version: 21/05/2021 (03:25 pm)
Date (time) of first distribution of English version: 21/05/2021 (04:15 pm)
Target price valid until: max. 31/12/2021

-------------------übermittelt durch die EQS Group AG.-------------------

Für den Inhalt der Mitteilung bzw. Research ist alleine der Herausgeber bzw.
Ersteller der Studie verantwortlich. Diese Meldung ist keine Anlageberatung
oder Aufforderung zum Abschluss bestimmter Börsengeschäfte.

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Quelle: dpa-AFX