(This is a continuation of Part I due to 4000 word limit
To me, the financials indicate not all is happy in the land of RPC. But I am not an accountant so my interpretation could be delusional or there are good reasons for what I think are red flags. I have an ugly feeling RPC timed a stock split to draw attention away from their cash flow problems, hoping traders will flock into the stock offsetting the downward sucking pull of wobbly fundamentals which indicate the wheels are about to fall off sending RES crashing into a wall.
Issuing virtual slips of paper stock is easy, retaining cash per share...eh, not so much.
Speaking of Cash Per Share, three pennies? Whooo-wheee, giddy-up! Uh-oh, not alotta oats for this horse. It ain't going far I would bet, so too think a whopping 28% who hold a short position. HALiburton, on the other hand, has $3.09 Cash Per Share. Less than 2% are shorting it so I am thinking "oil glut" isn't the main reason for shorting RES.
An interesting observation is, I notice that ROL and MPX, whom these same RES directors oversee, also have low cash per share and low free cash flow. I am beginning to reach a conclusion that management is nothing but a bunch of vampires sucking all the blood they can out of the company leaving just enough to sustain life and draw in more fresh blood in the form of new shareholders. Maybe I have read too many Brian Lumley books.
If I am wrong here please do correct my interpretation! I never said all my knives in the drawer are sharp.
Right now, oil demand is high, supply not yet satisfied, but it soon will be because every cracker-jack outfit is drilling every hole they can find both on land and in sea. Expect an oil glut in the near future; hence, oil price will fall, demand for drilling will fall; hence, the stock price of RES will fall. Shorting RES is reasonable when oil price is high and a glut is on the way (glut may even be here now, and Obama releasing oil reserves will make it look like he gets the credit for lower prices), just as there is a glut of coal.
Check out BTU or JRCC compared to their previous highs concerning coal. There is a glut of NatGas too which also hurts RES.
But as I mentioned before, HAL doesn't have a high short ratio so glut doesn't appear to be the main reason for shorting.
As for coal, I plan to take a position in beaten down, Cramer-despised, unloved coal either late this year or the next, depending on demand and supply, and how feasible an investment it will be based upon the results of Obama's coal-bashing EPA Gestapo. Coal may not be a good investment under his, uh, "leadership" where wind farms and solar is being pushed hard so as to make people who think the earth is on the brink of a man-made global warming holocaust feel better about themselves and the future.
And please, do not start a Man-made Global Warming debate here. It is pointless. There are plenty of other places to argue this topic.