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PetroChina Co. Ltd. Message Board

  • investor1688 investor1688 Mar 10, 2008 12:46 AM Flag

    High oil price will not affect PTR

    PTR has 78% of China oil reserve and do not need to import much crude oil. PTR will actually benefit from the rising of oil price. Plus China Government is considering loosing up fixed price on refined oil. PTR has a current Value of $214.26 per share. Therefore, it is undervalued compared to its Price of $133.99 per share. PTR has a forecasted Earnings Growth Rate of 21.00% PTR's price is affected by current US stock market situation.

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    • "Keep the origional and then start selling the highest one first, percentage wise it's best and the preimum on the bottom has more protection incase it drops later.. you should have kept the 120 calls all the way to the end.."

      > snp had a good run but dropped all the way from 160 in december to 78 last week
      > selling original 120 calls and 130 to 160 calls (kept 170 & a80) was the right moves. in this case, u cashed in profit, and let the cheap 170-180 calls expired

      > 1 question is: if u can predict correctly market will go up continuously, all buying strategies will work, isn't it?

    • Works great in an up market, not so great in a down one lol I'm sure you know buying well under the money calls is safer but less percentage profit. My advice would be and what I would do is sell way way below the money puts your almost positive will expire worthless .... doesnt have to be same stock ..... Stock like bidu with a high preimum would work, anyhow ... then take the money you got with the puts and buy calls, that way it reduces your risk somewhat, reduces because it's free money but only free money if the puts become worthless. Another thing you can do is use time to your advantage, selling puts 2 months out and buy calls 1 month out. The puts are giving you more cash and time as well. Eventually we will for sure have another bull market. If you buy above the money calls and plan on selling and buying more I would reccomend selling the top ones first and the bottom ones last, most people\novices do it the other way around. Keep the origional and then start selling the highest one first, percentage wise it's best and the preimum on the bottom has more protection incase it drops later..... these are not my ideas they all have names I wont bore you with, mostly because when I use them on the net people complain i'm tryiing to sound smarter than I am lol .... My critisism of your other plan is you should have kept the 120 calls all the way to the end or at least what you didnt need to buy more if you needed the cash. It would have produced at least as much if not more and been safer .... go back and see if you can...... because you bought back the options with the most added inital value to soon, and replaced that value with more risk and less value.

    • richard,

      Thanks again! It is true that go with something on the uptrend or more certain normally will do much better.

      Just accidentally last year I found out another strategy which gave me several hundred % profit. I am naive and try to see if I can find some stocks to experiment it again.

      I started buying SNP calls (about 10 dollars higher strike than market price) in September last year, when it came back up from August's sub-prime crisis at around 110 (bought 120 calls). I kept on buying call options little by little when SNP sent up every 10 dollars or so (and kept only the last 2 or 3 options I bought).

      When SNP went up to its highest ($178), I kept only the last 2 (calls 170 and 180). When it began to come down, I sat tight and didn't buy any more. It worked quite well.

      I am thinking that so many good stocks have come down so much, may be certain stocks will repeat something similar.

      Banks and PTR/CEO are a few I am looking at right now. I started buying a few of them at out of money calls. I didn't buy much because I am not sure the rally has begun. If it comes down, I son't buy any more. If it goes up, most likely I'll repeat the one I did before.

      I am not sure this kind of strategy will work? Any comments?

      Regards

    • It's a lot easier to predict what the Brasilian goverment will do ! I switched out of PTR and went PBR a long time ago. From your other post I gather your thinking of buying new shares, I would go PBR instead for certian. Just because PTR is down more dont mean it will go up more, stick with whats working not what might work incase something changes ..... When you try to hit a home run do you hit the pitch thats coming at you, or see a fastball and decide to swing at it like it's a curveball because something might change along the way ? Pretty poor analogy maybe, but the point is stick with whats working now and stay far from whats not. Those who already own will probabbly be better off holding but it will be a long day coming before it hits a new high and not a long day at all before PBR does, at least not nearly as long..... I would never reccomend someone else cut a loss and hope to gain it back on something else faster, but thats exactly what I did with PTR at 180 and I am MUCH better off.

    • PTR produced and refined about the same amount of oil (crude).

      In my opinion, If the selling refined oil price is about $80 per barrel (current controlled price?), the maximum profit PTR can get is about the same as when oil price is traded at $80.

      As a matter of fact because operating and material costs have gone up substantially, the actual profit will be less than when oil was traded at $80 before (unless government gives some compensation, which is not the case right now- according to the report).

      The only hope right now is government will raise the controlled price or give compensation to PTR, otherwise PTR may suffer more.

      This may come true because there is a shortage of gasoline and diesel in China gas stations now. No one want to buy and sell at a loss.

      However, it's hard to predict what Chinese government may do?

    • You are right with your arguments, which we all know the facts. However, we are holding and buying with the expectation that Chinese Government will adjust the price and also the current attactive price level. You buy stock on future expectation based on available information and your judgement. Also see
      http://www.cnbc.com/id/23728612/?__source=yahoo%7Cheadline%7Cquote%7Ctext%7C&par=yahoo

      18 hours ago
      Your First Move For Monday, Mar. 24th
      Posted By:Carlo Dellaverson
      Topics:Stock Market | Stock Picks
      Companies:Oracle Corporation | PetroChina Company Limited | Microsoft Corp

      Jeff Macke believes in the financials breakout and is buying the XLF Financial Select Sector SPDR FundXLF
      26.32 UNCH 0% AMEX


      Quote | Chart | News | Profile
      [XLF 26.32 --- UNCH (0%) ].

      Guy Adami’s going with Microsoft Microsoft CorpMSFT
      29.18 UNCH 0% NASDAQ


      Quote | Chart | News | Profile
      [MSFT 29.18 --- UNCH (0%) ], which he predicts gets a 30-handle.

      Tim Seymour said the time is right to buy PetroChina PetroChina Co LtdPTR
      122.55 UNCH 0% NYSE


      Quote | Chart | News | Profile
      [PTR 122.55 --- UNCH (0%) ].

      Pete Najarian is bullish on Oracle Oracle CorpORCL
      20.08 UNCH 0% NASDAQ


      Quote | Chart | News | Profile
      [ORCL 20.08 --- UNCH (0%) ] into its earnings next Wednesday

    • ONLY explanation ? I'm sorry but the real explanation is PTR is more of a refiner than a driller and high oil gives them a loss on each barell they refine inside China, they are trying to slove that problem in the long run. But the "real" explanation is that the company is worth less today than it was when oil was cheaper ..... go figure

    • When the oil price is up, PTR is down. When the oil price is down, PTR is also down. The only explanation is when the Market gets into selling mode, people sell for whatever reasons. Although PTR's earning is not as expected, the investor should see the value and potential return at this price level $120.63. This price was built in with continue rising of oil price and no price adjustment from Chinese Government for refined oil. However, per Hong Kong newspaper, PTR's management disclosed at the press conference that PTR already submitted the proposal to the Chinese Government to request the increase on the price of refined oil and tax rebate on imported crude oil - this will put significant pressure on the Chinese Government and you should see the price adjustment for refined oil will come soon.

    • I agree. The selloff is panic selling of the entire portfolio without any sense of how good (or bad) an individual company is.

      PTR has so much in oil reserves it does not worry much about the price of oil but the only squeeze it has is gov freeze of gas prices. When they let up on this earnings should soar for PTR.
      I think the price today will be a nice time to add more...

    • As I predicted yesterday, traders took their one day profit. Today's price range is $138.00 - $141.40. From here, you should expect a trend up to $160 (assume no big bad news from the market). People should not be affected by "China Watch, forget PTR, look to CEO". CEO certainly is a good company. However, the most recent calculated PTR intrinsic value is around $219.27. Current price of $138.02 is significantly undervalued. People should look at PTR's past performance. Fundamental (China growth, Chinese Government price control, rising of oil price, PTR management etc.) that PTR's price build on has not been changed.

      • 2 Replies to investor1688
      • With several bad news today, PTR is down. However, it appears there is a general consent that Monday's low might be a bottom. When the Dow moved toward Monday's low, with a trigger of S&P report, buyers start kicking in and Dow close in green (Not too bad, considering some very bad news). If Dow can close in green or even a little bit off today's close, it is a good sign for a market recovery. With all the financial mess, oil and gold hit $110 and $1000, we enter into a new era. "Market" looks around and said: "So what, I have to move on. I will find my way." Some financial companies are going to be underwater, they need to take the consequence as they took the risk. The rest of the market, especially good companies, should not be published in the same way. At the price of $133 for PTR, no much profit for traders to take. Today's sell-off provides you with an opportunity to buy. According to Yahoo China, Chinese government is expected to adjust domestic refined oil price in March. If this becomes confirmed, it will be a big plus for PTR as it drills most of its oil from China oil fields (most of the fixed costs stay relatively comparable). In light with this, PTR is currently up 4.62%(中国石油(601857.ss) 最新价:22.65 1.00(+4.62%)(交易中) at Shanghai stock exchange. You may see a jump for PTR if Chinese Government adjusts the price soon.

      • it is going to be a bad day.

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