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Encana Corporation Message Board

  • huamilpa huamilpa Feb 9, 2006 4:17 PM Flag

    ECA: TAKEOVER TARGET?

    Serious comments on this post please.

    A few weeks ago Conoco bought Burlington Resources when the price of natural gas was almost 80% higher than now.

    With the big integrated oil companies flush with cash, would Encana be an attractive takeover target atr these levels? I would think so especially when acording to Yahoo! Finance the P/E is down to the 10 region.

    Encana would be suitable for any of the majors involved in the oilsands development as natural gas is needed for the extraction of oil out of the sands.With Encana reserves a long term supply would be assured plus some of Encana fields are cloe to the Tar Sands deposits.

    Comments please?

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • I have been follwing ECA for no. years. For this price level, ECA is very high to be taken over. I am not surprised they actually announce that on Wednesday Feb.15 when they announce earning. I would not short this stock at this low price.

    • Encana with a 57.00 U.S. target which is a little on the low side would imply that the selling has dried up. If the target price was lowered I would see further downside but that isn't the case here. Ross Healey and Brian Acker on Rob Tv(Canadian Business)in the last 2 days set a 71.68 and 77.00 Canadian target price with a must buy at these levels.

    • Dear huamilpa,

      Greetings and thank you for your post.

      It is my firm belief now that an offer has been made to ECA.

      Today I spoke with IR at Encana and was told my the fellow I spoke to when I asked several questions that " there is no news I can talk to you about".

      My gut tells me that an offer has been made following the November negotiations on the oilsands. Last November all the majors and State Owned oil Companies were given confidential access to the oilsands data. Since then, and the BR takeover by COP, the need to replenish reserves from a safe reliable country, my reasoning is that an offer has been made to Encana, that the Board has met, that the management are putting the best spin on the Q4 editing in all shape and form to come public with the news that an offer has been made. They are doing this in order to shop the deal and to obtain the best possible offer for shareholders.

      My guess is that Total, RDS or one of the State owned Chinese companies have made an offer. The drop in price since Jan.31 puts more demands on management and I can tell you that tonight in Calgary the lights will be on in those offices as senior management prepares themselves for news in the coming days.

      You can't honestly believe that the mild winter erodes the serious lack of NG supply constraints in North America or that free oilsands reserves are going to be replaced so easily. Free because they not recorded as assets till realized. Just crazy! The bidder isn't crazy! They understand long term value as COP did with BR. Don't be fooled folks by this share price drop!

      For those strong enough to stay Long you will be rewarded.

      Hold onto those shares and don't let those Short assholes steal away shares that are worth so much more.

      Teutracker

      • 1 Reply to teutracker
      • Good post teutracker..I have been buying ECA on the way down .Just three months ago everybody was screaming that NG reserves were being depleted faster than they were replenished.And now with a mild winter and unlike oil, NG not having a "risk" premium unvilved, prices have dropped almost 50% unlike oil.
        Takeover or no takeover, long term investors in ECA will profit. At $7 MCF, Gas companies are making a killing (remember the price was $2 MCF not that long ago?).I'll just keep on buying on dips. Good Luck

    • a takeover has crossed my mind. i have seen all the negative eca analysis from the talking heads on warm winter, tight gas and hedges being the reason behind the stock underperforming and think it is all bullshit. the tar sands holding is totally being discounted and i am just accumulating and waiting to find out why.

      i bought more today closer to my cost basis. su, uts, pcz, cnq and cos.un have all been on a tear and justifiably so. if anyone thinks mr bush's comments on unstable regions and alternative sources of energy in the state of the union speech was about wind and solar power i've got a hydro electric project to sell you. the boobs bashing on this MB are just here to scare the dumb money. they will disappear into the ether when its time for encana to move up.

      • 2 Replies to tripedbiped
      • Talking about takeover, it reminds me DCE.TO (Deer Creek Energy) sometime around last july 2005, it was trading around $ 16.50 and suddenly it was bought up by a french company with a $ 6 premium -- not much later, the same company came up with a better offer they added another $ 6 for a total of $ 12 !!!
        The stock went from $ 17 to $ 29 more or less !!!
        Now just imagine how much ECA could worth with their huge reserves !!!?? From $ 45 - $ 50 now (in cdn dollars) it could reach easily $ 65 - $ 70 imho.
        I would prefer a merger because long term the potential is much greater -- so, whatever the price is today don't matter much as the value is still there in the ground waiting to be pump out ... !!!
        I was posting at the time with the same argument regarding DCE and I think a similar story will happen again with ECA !
        The good news may come after hours sooner than later ... hopefully !
        jet

    • I watched a show on CSPAN yesterday on energy. In short, world demand is growing but supply has peaked. Long term prospects for oil and natural gas are very bullish. Any energy company with a long term outlook should consider a company like ECA. This pullback is temporary. If they wait 9 months the price will be back over $50+. Opportunity is screaming right now.

      Suncor(SU) would be a perfect fit.

    • Any smart investor would vote againts a take over. You can always tell the time horizon of retail investors on a BB by measuring the percentage of posts grasping and balking for a take over.

 
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