We are not alone it seems in scratching our heads in recent months as to why the stock price of Mayan Energy has not been responding to the underlying operational progress and rising oil price. Under the stewardship of CEO Eddie Gonzales the company has been transformed into a cash flow positive minnow with a growing production profile and exposure to the exciting Asphalt Ridge prospect in Utah through the re-negotiated stake in Petrotreq (see HERE re the upside we see in this stock) aswell as recently exiting from the millstone that had been Shoats Creek – a legacy from the previous management. From misplaced and ill informed comment of a placing months ago to biased research from another City house with a negative agenda the company has assuredly proved each of these positions wrong. 

News out this morning of a warrant exercise totalling over 44m shares looks to us the be the green light for the long awaited re-rating of the stock to catch up with events on the ground. We have taken advantage of the seller in recent months in adding to our position and believe the stock to be now at its most exciting point since the recapitalisation last August as Eddie Gonzales moves full speed ahead now to push production towards 500 bopd. When this milestone is achieved we can see our price target of 2.1p being surpassed and thus with the news this morning of the stock overhang that has bedevilled the shares for many weeks looking to be gone we once more reiterate our Conviction Buy stance per our note HERE.

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• Mayan Energy