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Calpine Corp. Message Board

  • madison8722 madison8722 Mar 12, 2002 3:41 PM Flag

    I just don't get it

    I guess I'm just a dumb phuck.

    Why all the selling today? Just does not make sense to me. The CC was very good.

    I wouldn't be surprised if we get a bunch of upgrades tomorrow. I just don't get it.

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    • Madison,

      Don't be discouraged. The market has a random, irrational element to it. People take profits for all kinds of - that's all that happened today. Some think they will buy back in a lower price. They may be right, they may be wrong. I can remember following that strategy, then watching the stock run away from me.

      Nos

    • With these adjustments, Calpine now has 127 F-type gas turbines on order for delivery between 2002 and 2007.

      "I suspect it is still a little aggressive," said Chris Ellinghaus, an analyst at Williams Capital. He expects Calpine may make further reductions in its orders before the program is complete.

      Patience son

    • shortie selling acelerates the dip but builds support
      weak longs and profit taking
      plus the charts not looking so good
      bad overall market conditions triple witch fri.
      basher's need a day in the sun
      big rally coming good chance it happens before friday ya know beat the stampepe
      not going back to 8-9

    • If you sell you are a dumb phuck

    • Perhaps the story is just too complicated.

      The analysts (and presumably also fund mgrs) seem to have lost sight of the forest for the trees. For example, not one question today related to "current average spark spreads are significantly improved in major markets" or to possible impact of gas price chages and sparks on Q1 earnings--and this in the face of the statement by mgmt that "spark spreads. Instead, they all repeated variations of the same question about turbine purchases.

      So, they don't care about earnings, or the future free cash stream that is just around the corner (largely forward sold), but are worried about a matter of timing of turbine cancellations (with a cost, but not a major impact factor). Go figure!!

      • 3 Replies to notplayingdead
      • notplayingdead, you *do* get it. ... the market doesnt ... yet.

        Liquidity is becoming a non-issue. The terms extracted are harsh but were made in an environment of enronitis. they will have $1.8B on hand end of year, by projections. by this time next year, their cash flows on operating basis will be stronger and their future buildout requirements will be much smaller. rolling over short-term debt will not be an issue. At that point it will be EBITDA and earnings driven.

        Seeing the forest means seeing the drivers for Calpine's future values. You are right. spark spreads mean a lot. And it is good for CPN.

      • notplayingdead,

        you write:
        --and this in the face of the statement by mgmt that "spark spreads.

        period? end of sentence? what did mgmt say about spark spreads? can you restate? Thanks.

        You are right however, increase in spk spreads is the key issue for profitability in CPN's whole business model.

      • yep yep yep

        that bothered me that nobody wanted to talk about improving spark spreads

        course on the other hand that's kinda like talking about lap 43 of the Indy 500 aint it?

    • This wasn't all good news dude. On the one hand, CPN got the cash but on the other hand, look at what they had to secure it with - assets that are probably valued at more than double the amount of the revolver (UK power plant, all of CPN's gas assets, equity interests in 9 new plants, 4 of which are already operational). Those are assets that can no longer be sold in the event that more cash needs arise later on this year or next. Additionally, the bond market is now out of the question at the moment because:

      1. CPN's unsecured bonds were downgraded by Fitch and S&P

      2. Creditors holding unsecured bonds are now more likely to get screwed in the event of a bankruptcy because they rank behind the secured revolver.

      With no positive earnings guidance announced, the signs are not yet there that the operating cash flows combined with the revolver will be enough to replace what they would have raised in prior years through the bond and equity markets.

      Personally, I was more confused as to why the stock went up so much last week....I think the market was expecting something more than just the announcement of the secured revolver closing, and when that was all the news that was given, the price contracted a bit.

      • 1 Reply to comfortablydumm
      • UK power facility is actually a jordie who lives on Baker street in London and owns a Honda 5000 watt generator that he rents out to hydroponic comrades in Camden Locks area.

        Bankers are such twits to do business with but CPN's bondholders may be just as bad. The bottom line is that CPN will take about 3 years to make more than $3 billion in net profit. That's what I call management, how about you?

    • You are going to close in the black afterall.

      Good for you.

    • I was just telling my wife that I didn't understand whats going on either. The more I think I know about Wall St, the more stupid I feel when things are 180 degrees out from what I would think with all the good news. Oh well...holding long

    • Wall Street isn't what it used tobe. It is full of liars cheats and thieves now like Kramer and the hedge funds. Screwing you out of money is more important than proper investing, which used to be the Street's job.

    • not that i really know wtf i'm talkin about

      but since you asked, terms were a little tougher than market expected and the turbine cancel payment was not factored in - and there is still some uncertainty on that whole issue

      and of course phuquing ca cant get its act together

      whole sector was down today, probably just profit taking and cpn's was aggravated by some of the news

      again efficient markets theory suggests that we already knew they had a facility in hand, just a matter of details and details were on the low side of expectations

      plus just a down day for sector

      jmo fwiw (nadda?)

      regards and better day tomorrow, dmc

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