The Calgary-based firm, focused on Alberta, has near term drilling plans, which includes the Rex play, the lower and upper Mannville plays and at Paddle River and two recently identified Banf targets at the West Cove area.
Analyst Bill Newman said that on the broker's estimates, any single one of the group's prospects could add more to the group's reserve value than the current share price of $0.23.
Yesterday, the news focused on the Rex horizontal oil well, which the company expects to be completed and evaluated before the year-end.
The horizontal drill section was sunk and cased over the weekend ahead of 28 frac stages at 30 tonnes per stage, Point Loma said.
Mackie noted that internal mapping indicated that the Rex oil pool has the potential to hold 60 million barrels of original oil in place (OOIP) on the company's lands.
Assuming a 10% recovery factor based on primary production only, the broker calculates a potential net recoverable of around 4.8 million barrels equivalent to around 65% of the firm's current 2P (proved and probable) reserves.
"Success on this high impact play would set up 20 follow up opportunities, and could be a game-changer for the stock," said Mackie.
Point Loma, with a market cap of around $17 million has no debt and is highly undervalued trading at around 35% of its reserves value at $0.58 per share for the Mannville play only (not including the new Rex oil play, Lower Mannville oil play, Banff or Duvernay shale play), says the broker.
In its latest presentation, producer Point Loma said output was headed to around 1,000 barrels per day with the cost of production declining sharply to C$11.64.
The broker repeated a 'buy' stance and $1.10 price target, which is a long way from the current price of $0.215.