Dana Gas PJSC rose to the highest level in 10 months as speculation the United Arab Emirates energy company will collect outstanding payments in Iraq and Egypt boosted its earnings outlook.
The shares rose 4.1 percent to 51 fils, the highest level since March 5, at the close in Abu Dhabi. The company was the fourth-biggest gainer on a percentage basis in the benchmark ADX General Index, with almost six times the three-month daily average volume traded. Dana Gas said its board approved the 2013 budget, and discussed progress on projects in the U.A.E., Egypt and the Kurdish region of Iraq, as well as efforts made to collect outstanding receivables.
Dana Gas had to restructure about $920 million in Islamic bonds last year after political instability in Egypt and Iraq led to the payment delays. The company may report 15 percent growth in 2012 profit to 584 million dirhams ($159 million), according to the median estimate of four analysts on Bloomberg.
“Cash flow is really vital for Dana Gas and any news on new collections will enhance the balance sheet as well as reduce the amount of uncertainty of investors as they refocus on the fundamentals” after the debt restructuring, Tariq Qaqish, deputy head of asset management at Dubai-based Al Mal Capital PSC, said by e-mail today.
Dana Gas’s shares are undervalued and are worth 90 fils, Exotix Ltd. said last month. The shares are trading at 6.6 times estimated 2012 earnings, compared with 13 times for Carrizo Oil & Gas Inc., a Houston-based natural gas and crude oil explorer and producer. The stock was the most-traded in the Gulf Cooperation Council so far today, according to the Bloomberg GCC 200 Index.