Don't usually participate in this one.....usually stick to NE and ESV although I do have a small amount of HERO. Buying DO down here is a read on what I think happened recently with the stock price. It had a major short squeeze in April that got it way out of line with its peers....now it has gotten crushed as the short squeeze finished playing out, and some bad news got the stock knocked back down. I think 47 here in DO will end up being close to a bottom, and it has been subject to short squeezes for many years. Looking to hold it for a test back up close to 50 over the next few weeks.
DO is not investing enough on new build rigs vs their competitors. They are capital-rich and they are not investing in their core business. Give it time and they will be either bought out or ground down.
Thanks for the heads up yesterday Chute, don't usually trade DO but bought yesterday at 46.50 after reading your post and sold this morning at 48.20........might go higher but that was good enough for me, still have NE, ESV, and HERO
Glad it worked out for you bits....nice trade. I also continued to buy when it dropped below 47 yesterday....just felt like it was too overdone. I had planned to keep some for a run closed to 50, but just kept selling as it rose today until I had none left.
I still have NE and HERO. Looks like NE is heading up to test April Fool's Day highs close to 33 as I suggested it might....who knows it could form a cup there with a handle.....very bullish if it does that, esp. if the handle has low volume and low volatility and lasts for about a week. It seems like the deepwater guys are getting discovered today....doesn't surprise me given oil prices and strength in oil service sector which is setting new 52 week highs everyday....at some point they are going to go after the dogs of the sector.
6500 open contracts at that strike now. Only problem is that options don't pay dividends. So given that there is no other plan in place, when the company squeezes Paragon out as a dividend, option holders are going to be holding the short end of the stick. NOT a good stock to buy LEAPs in with this kind of upcoming dividend.