I bought 10,000 shares of $PROP today

A DJ Basin oil producer with $1B in reserves, a new CEO, and a single event that could unlock everything.

An oil producer generating $250 million a year in EBITDA just lost 85% of its market value.

Not because the wells stopped producing. Not because oil prices collapsed. Not because the reserves disappeared.

Because the people running the company nearly destroyed it with one of the worst financing deals I’ve seen in years.

Here’s what happened:

The company acquired a high-quality DJ Basin operator for $600 million. Good assets. Good production. The deal itself made strategic sense.

But the financing was brutal.

They issued common stock at $4.50 per share. They loaded up a Series F preferred carrying a 12% cumulative dividend. And they included a provision that, if the stock traded below a certain price by March 26, 2026, the company would be forced to issue roughly 115 million new warrants, nearly doubling the share count.

The stock is at $1.42.

That condition is already met.

The result? A company with over $1 billion in proved reserves and 28,000 boe/d of production trades for less than $85 million.

Here’s the thing. The two executives who did this? They just got replaced.

And the man who replaced them grew his last company’s EBITDA from $12 million to $500 million before selling it for $1.5 billion.

This is a binary setup. Either the new CEO refinances the toxic preferred before the March 26 deadline, and the stock re-rates violently higher. Or he doesn’t, and dilution gets worse.

But even in the worst case, the per-share asset value with full dilution still sits above the current trading price.

In my view, much of the downside is already priced in. The upside, if things go right, could be 12x+.

The full write up is published here:

$250M EBITDA, $85M Market Cap, 12x Upside, One Catalyst.pdf

Download PDF • 417KB