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Show National Enterprise , May 26, 1976 r-r- Page Eleven The Red Hen Syndrome Californians hold in their hands the very fate of nuclear power in this country. June 8 they will vote to ban the atom as an energy source in the Sunshine state. Without technical education or knowledge, rank and file voters may ignite a brush fire that could spread to the twenty other states where similar proposals are scheduled to appear on ballots within two years. Now California is a lovely place and its reasonable they should want to protect their fragrant orange groves and sunny beaches. It also follows the Mountain States would want to preserve the beauty of their landscape for themselves. standards in California are so d electrical generation high that plants are out of the question. And without nuclear power, few other sources remain besides oil and gas that are in dangerously low supply. Like the story of the little red hen, Californians would prefer that the Mountain States mine their own coal, by either d deep or surface mining, to power plants built here, suffer the economic and social impact of an energy boom, contend with pollution created by those plants and in the end, sell our power to them. Air-polluti- on coal-fire- coal-fire- Its not often we concur with the AFL-CIbut we couldnt agree more when they say of the enviommentalists, Let the bastards freeze in the dark. In the shadow of the Big Board there are still many securities whose values continue to be overlooked by the investor. But some of these stocks are apparently being noticed. In any case, for a group of stocks that have been avoided by individuals, ignored by institutions, and followed by a number of obstinate supporters, unlisted (OTC) issues gave an excellent accounting of themselves in 1975 and the first part of 1976. The NASDAQ Industrial Index gained 43.4 percent in 1975. This compares with a gain of 39.4 percent in the Dow during the same period, suggesting that the OTC shares may still have some active life ahead of them. The reason for the lack of interest in unlisted securities over the past several years seems to boil down to their lack of which has been sponsorship by institutional interest, The belief fostered by big name research departments. continues that OTC stocks are dead. This way of thinking is probably brought about by the problem that most OTC companies have capitalizations that are so thin banks or other institutional investors couldnt establish a position in these stocks even if they wanted to. I believe that not only is the OTC market alive but it is active and responding well as its performance in 1975 depicts. But as I continue to uncover what I feel to be good growth situations, the investor must iv.:iember that he or she may have to wait months or even longer for these sleeper companies markets to move ahead meaningfully. Another company meeting last weeks established criteria of: -- a company within an industry whose potential growth is above average; a company whose financial position is highly liquid, a current ratio of over 4:1; and a company whose management shows a growth-oriente- d philosophy-- is Century Oil and Gas. . O, Shareholders of Century last January ratified a proposal merger of Saks Oil Company into Century Oil and Gas. This merger increased Centurys total asset base to $933,533 of is under the current asset which approximately one-hacolumn. Prior to this merger, Saks Oils 72,000 common outstanding shares showed $.30 earnings per share or $21,701 in income on $187,299 in revenue for the nine month period ending Sept. 30, 1975. That same balance sheet pointed out a $3.20 book value per share compared to Centurys book value of $.06 per share. Century has properties in Wyoming, Kentucky, Colorado, Montana, Nebraska, Tennessee, and Texas. Positive production additions to Century have been an interest in 32 producing wells in the south Highlight Muddy Sand Unit, and an interest innovative Money Mgt. & Analysis in 40 producing wells in the Jayson Muddy Sand Unit. Research Director The total net production in 1974 to Saks from these properties Pittman & Co. was 23,900 barrels of oil and 642,000 Mcf of gas. Century has recently announced the acquisition of an overriding royalty interest in a 960-acr- e prospect in the Ryckman Creek area of Unita County, Wyoming. The acreage is said to be about two miles north of the recent prolific discovery of Amoco Production Company. This wrell is reported to have uncovered an oil and gas pay zone of more than 500 feet in depth in the Nugget lf formation. The security price range of Century since its offering at $.10 has been .09 to .17 on the bid side. The price of this stock has not approached the higher level since December of 1975. Although I must point out that a dissolution factor of some 45 percent of voting common was incurred in the merger, I continue to feel that at this price; investors have overreacted to this dissolution factor and have not placed enough emphasis on the position attributed to the merger. |