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iShares Mortgage Real Estate Capped Message Board

  • ophelia342001 ophelia342001 Mar 30, 2006 10:26 PM Flag

    HELX eps estimate lowered


    UBS lowered its eps for 2006 from $3.05 to $2.90 due to natural gas pricing but says 50% of production continues to be hedged. Says "liquidation value " for shares is $21.43 for "combined company".

    I like Jim Stone (UBS) as an analyst, one of the better oil field analysts. Believe the talk about "liquidation value" is to convince others of the value of the merger. Believe the generals are still chewing on it.

    Zack's Investment Analyst has a buy on HELX...i.e., a 2. The best is a strong buy, i.e. a 1.

    Were I you I would sit tight. I believe it will go down further. When it does go in, buy, but expect a bumpy ride. Reading between the lines, I'm not sure Wall Street is convinced yet.


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      I missed the program too; I caught the very end. Thanks "pick" for the rebroadcast info. THE REBROADCAST WILL BE ON APRIL 21 AT 7 & 11 PM.

      The "Witch Queen" is oldest "Dynamically Possitioned" (DP) Vessel in the HELX fleet of DP's. I recall when the Old CDIS brought her into the GOM. She has been a work horse ever since. I would have preferred having "Discovery" do the show on the "Q4000", the "Uncle John" or any other of their newer, more impressive vessels.

      However, let me assure everyone, this is not meant as an insult to the "Witch Queen" crew. The opposite is true. "maxwell" (msg 3385) who saw the program, reported that the crew executed a difficult repair at sea, making a difficult to replace part on board instead of returning back to port for repairs. I bet the Chef didn't even have a recipe for the cooking the part required to make it fit back on the thruster. (HeHeHe) That's the way those HELX people are, from upper management to the last guy on the crew. They are creative, self-reliant but work as a team and just don't give up. So many other company or vessel would have just went "back-to-the-beach" and would have been down for weeks. Not these guys especially this crew, remember the crew had been as sea for about 4 months.

      When I was still active in the business, I read countless articles in industry magazine like "Offshore", "Dive", etc. where Cal Dive had executed the unusual or innovative job for a client. I'm not pretending that this is so unusual in this industry; You see this in most good "can-do" companies with good "can-do" people.

      As a contented investor, I say "Hat off to ya ! ! ! Make your Project Manager buy you all a round or two when you hit the beach.

      Old Watchdog

    • hey dog......this is a new way to post, I guess.....not sure how this is all working on Yahoo! Got your message........coupla days ago.....trying to access HELX board again....left a new message, just to see if it worked!~ Now, how can I add all those stars you put on your recco..........???

    • I'm continually baffled by the estimates of HELX alone being bantered around. The REM acquisition is accretive in '06! For the real story, do your own DD and look at what you expect the HELX+REM EPS to be in '06.
      Last time I ran the HELX+REM numbers, I came up with a combined EPS for '06 of around $3.80. That's the number we should be talking about IMHO.

      I'm interested to see if others what others have come up with for HELX+REM combined '06 EPS.
      Who's done their DD and is willing to share their guess?

    • Report issued on March 23,2006. James H. Stone number one rated analyst in this market segment. You convienently forgot to mention the re-iterated his price target of $56 per share.

      The earnings down grade specifically related to lower NG prices. That day was closed to the bottom in NG what a Coincidence.

      Anyway, the analyst lowers the earnings estimate because of short-term visibility concerns in NG but re-iterates a price target of $56. Considering the stock is 37-38 and he has a price target of $56, it makes alot of sense to lower your estimate when you are the number one guy in this game and the stock has a long way to go to reach your target.

      Liquidation value is what bankers would look like in the event of bancrupcy. What you failed to mention is the increase in the liquidation value as a result of the proposed merger with REM. The increase is from $8.85 to $21.43, wow that is a tripling with an acquisition that is accretive to earnings and can be paid for with 18-24 months of cash flow.

      If we find more reserves the $21.43 moves north that is why they paid a high current reserve multiple with the firm belief of much greater exploration real estate and skills. Combine this with the synergies of old HELX doing the work and you have a very powerful model, even with declining prices.

      I think your post misses many points completely and you should reverse your position before you get hurt.

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