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A great summary from Pinnacle Digest came out after the close today on KFG. I think this will attract some new buyers and watchers tomorrow as this company bucks the trend of the falling oil stocks. The best juniors are the ones that can make money when everyone else is losing money. It didn't specify, but last year KFG made $120,000 half half of the revenue and $76 price per barrel.
Best part at the bottom of the article:
This is all relevant, because on Monday, KFG was among the most liquid stocks on the TSX Venture. In a tumultuous environment for even the most balanced and successful oil and gas companies, KFG has found a way to climb within striking distance of its 52-week high.
Investors will need to see continued production increases and exploration upside if its market cap is to rise.
KFG Resources is representative of a junior resource stock that can still catch a bid because it has revenue and low costs. When a company earns in for a limited percentage of ownership of any given well, it mitigates its risk hugely; if the companies involved should miss on the well, they move to the next opportunity.
A junior oil and gas company can earn 10% on 10 different wells, providing it ten times the opportunity of hitting on any single well vs. being the operator and earning 100% on a single well. This is not a new strategy, but one being utilized more and more often in the junior resource sector.
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