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    Stock Report for Ivanhoe Energy Inc. (IVAN)

    Ivanhoe Energy Inc. (NASDAQ: IVAN) is an independent international heavy oil development and production company focused on pursuing long-term growth in its reserves and production using advanced technologies, including its proprietary heavy oil upgrading process called Heavy-to-Light (HTL). Core operations are in Canada, United States, Ecuador, China and Mongolia, with business development opportunities worldwide. Ivanhoe Energy is responsible for Canadian operations, while operations in Latin American are conducted through Ivanhoe Energy Latin America Inc.  Activities in China and Southeast Asia are operated by Sunwing Energy Ltd. (Sunwing).

    Share Statistics (29-Dec-11)   FY












    Symbol IVAN Revenue, $Mn 23.66 21.93 -7.3% 4.26 10.99 158.0%
    Current price $1.18 Gross marg. 62.5% -1.7% -102.7% 9.2% 28.6% 210.9%
    52wk Range: $0.72-$3.67 Oper. margin -126.0% -31.4%
    Avg Vol (3m): 823,213 Net margin -134.0% -121.2% -9.6% -225.6% -37.9% -83.2%
    Market Cap. 406.08M              
    Shares Outstanding 344.14M EPS, $ -0.11 -0.08 -27.3% -0.03 -0.01 -66.7%

    Source:, SEC Filings.

    Investment Highlights

    Shares of Ivanhoe Energy Inc. (IVAN) advanced almost 16% to close Thursday’s session at $1.18, extending gains into a second day.  Over 3.07 million shares traded, topping the 10-day average of 1.56 K. IVAN is currently trading above its 50-day moving average of $0.96 and below its 200-day moving average of $1.38.  Market capitalization currently stands at 406.08 million and it has 344.14 million outstanding shares.

    Shares of the independent international heavy oil development and production company have gained 26.9% in the last five days and 21.7% in the last month.  Year-to-date, the stock is down 57.9%.

    The Vancouver-based company, which is focused on pursuing long-term growth in its reserves and production using advanced technologies, recently produced a video explaining its proprietary heavy oil upgrading process called Heavy-to-Light (HTL).

    As explained by the Company, HTL is an upgrading process that can be located in the heavy oil field, completely integrated with upstream field operations. The HTL process converts heavy oil to lighter, more valuable product that can be transported by pipeline without the need for light blend oils. In addition, coke and gas by-products from the upgrading process is converted in-situ to steam or power, and this energy is available to the operator to develop the field. HTL facilities can be economically applied in scales as low as 10,000 to 20,000 barrels per day.

    The video is posted on

    Earlier this month, IVAN announced the appointment of industry leader Carlos A. Cabrera as its  executive co-chairman.

    Cabrera, who joined the Company’s board as an independent director in May 2010 , has more than 35 years of experience in the petroleum, petrochemical and gas processing industries. Since 2009, he has served as president and CEO of China’s National Institute of Low Carbon and Clean Energy (NICE), based in Beijing; prior to which he was chairman, president and CEO of UOP LLC, a Honeywell company. The announcement is seen as part of a realignment of the Company’s leadership team.

    Robert Friedland , who has been serving as IVAN’s executive chairman and CEO since 2008, and now becomes executive co-chairman, also confirmed that David Dyck is continuing in his current senior executive roles as president and COO of the Company, and as president and CEO of IVAN’s Ivanhoe Energy Canada subsidiary.


    Financial Summary

    IVAN reported oil revenues of $10.8 million in the third quarter of 2011, compared to $9.4 million in the second quarter.  The Company attributed the increase to higher production volumes at Dagang and stronger realized prices.

    The Company realized a net loss of $4.2 million for the latest quarter, compared to a $9.6 million net loss in the comparative period of 2010.  Although oil revenue has increased in 2011, net income was impacted by higher operating and general and administrative expenses.  Operating expenses were $5.5 million during the third quarter of 2011, compared to $5.3 million in the second quarter of 2011.  These expenses were primarily from China and included an increased windfall levy, administered by the People’s Republic of China, following the rise in oil prices.

    Capital investments in the third quarter of 2011 were $16.8 million compared to $17.4 million in the second quarter of 2011.  The third quarter expenditures were primarily from activities in China, including flow testing and the running of down-hole recorders at the Yixin-2 and Zitong-1 gas wells, and ongoing drilling and fracture stimulation activities at Dagang.


    Financial Strength (29-Dec-2011)




    S&P 500

    Quick Ratio (MRQ) 1.73 0.85 0.77
    Current Ratio (MRQ) 2.80 1.84 1.12 1.15
    LT Debt to Equity (MRQ) 18.84 7.75 15.85 106.66
    Total Debt to Equity (MRQ) 18.84 8.70 20.69 143.48
    Interest Coverage (TTM) 0.38 4.52 27.08

    Source:, SEC Filings.

    Technical Analysis


    IVAN is above the upper Bollinger Band, implying that it is currently extended from its recent trend. Be aware, however, that a cross outside of the Bollinger Bands can sometimes be a signal of trend strength and not, necessarily, trend reversal.

    IVAN’s MACD is currently indicating a weak bullish signal. Although the MACD is trending above the signal line, the indicator is still below 0, which suggests that the underlying moving averages are bearish.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    Dec29-2011 symbol Share, $ $ Mn 2011 2012 2011 2012
    Exxon Mobil Corp. XOM 85.27 408.72B 9.95 10.21 0.84 0.91
    Apache Corp. APA 89.91 34.53B 7.59 7.27 2.07 1.89
    Anadarko Petroleum Corp. APC 76.16 37.93B 24.41 21.89 2.83 2.60
    Independent Oil & Gas Median       16.60 n/a 5.76 n/a
    Ivanhoe Energy Inc. IVAN 1.18 406.08M n/a n/a 10.87 9.37

    Source: Thomson Financial

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