The put buyers failed to take this stock down. The March put open interest is 10% of shares out.
These putz buyers failed to take into account: 1) NOG has great wells. 2) NOG is too cheap vs peers. 3) You have to sell the puts before expiration because you can't buy or borrow that many shares to be able to deliver on an option exercise. 4) Selling the puts drives the stock back up.
Not to disagree but none of the wells are NOG's. None of the wells are operated by NOG. NOG has good partners and is in good locations, but they are at the mercy of the operators. NOG is a royalty company like RGLD or SLW. It might be good to put the word royalty in the NOG name. Royal Gold stands for Royalty Gold, for instance and is it's old name from way back. NOG is better than an operating company, since it doesn't have all the expenses involved in drilling an hookups. Which if the well isn't a good producer reduces their exposure to the failure. Thus on the upside NOG's pay out on it's acres is much much faster than operators since they don't have to pay off all those drilling costs. The disadvantage is those royalty checks take a quarter to catch up to earnings. Since royalties are usually a quarterly pay out.
See how bad they need those 10,11,12 puts........they know they in trouble with that straight backwardation, and the end of the month coming, a bunch of people will want to exercise to make their numbers.