I guess it is the nature of man to look past the obvious and try to find the "real" reason for whatever.
The reason RIG, NOV, FCX, and all the other stocks with high growth and ridiculously low pe's have sold off, is because someone is having to sell to raise capital.
Think about what is going on in the banking industry. You know they own a ton of whatever has been hot lately. Then they get in trouble and have to raise capital. ARe they going to sell their losers or winners? Not only that but big institutions and banks that want in know that someone is having to sell. So what do they do? They quit buying and let the selling take the price down hard so they can buy at a discount.
Quit looking for the conspiracy and follow the money. The only reason you would sell RIG at this time and these levels is because you HAVE to. The selling will end, the buyers will come and we will go to a new high. Just maybe not today or next week.
You missed the point. Not everyone was selling. Some wanted to buy and knew that others HAD to sell and so waited while the selling was in full force. There is always selling and buying every day. More selling equates lower prices, right. So if you wanted to own this cheap and knew that there would be mass selling, why step in and buy when you could just wait for the price to fall even more.
Wick, I read it with less cynicism. If you take a step back, RIG has been a high flyer, and has enjoyed a higher premium than the other drillers. Now that it is more leveraged, the premium comes in the form of EBITDA/EV rather than P/E.
And I dont think he meant to communicate that the price is being forced down. Quite the contrary -- he said that he doesn't subscribe to the conspiracy theories. I am of a similar mind. Sure, in the short term, the quants play with the price because they can, but a stock doesn't sell off for this long, on this kind of volume, as a matter of pure manipulation, IMO. There has been real selling, which I believe is partly forced liquidation and partly out of fear that the stock will continue to go down because of a change in sentiment. I read his post as saying that once the forced selling ends, the price will go back up, and new highs will be reached. I don't know about new highs any soon, but I agree with the general thesis. I do think we still will face more liquidations, but I do think it's starting to dry up assuming that oil stay at current levels, which will attract additional buying interest to offset the selling pressure.
All just my rank speculation.
Hang in there bud. We'll get through this, and eventually rejoice. At least I HOPE so. Sucks to be reduced to hope -- but I also think the probabilities lean in our favor, though not like I used to.
Please understand, I am not basing my views on any conspiracy. Drillers usually tumble a bit in August/January. That is the nature of this beast. I lost quite a few sheckels this month.
I would like to offer an apology after re-reading your post. I mistook your view of some of what you said and your take on the situation. After re-reading your post it makes sense. Sorry for being a such a dick.
No apology needed. I am in this with you, man. I should have used the term "cash" rather than "capital".
I only wish I had the ability to KNOW when some hedge, fund, bank, etc. was being forced to sell. I am merely speculating but cannot imagine any other reason why anyone would want to sell at these levels.
I would say good luck but I truly believe we have a winner here based on factual fundamentals.
Hang in there and we WILL be rewarded even more.
Larry, it's understandable that your frustration will get the best of you at times. I have done the same countless times. Michael and Jay have given it back to me on occasion, and for good reason. I, too, can be a prick at times. Your heart is in the right place -- and I think your money is too; just be careful with the options, bud.