Oaktree Value Opportunities Fund just bought $20mm in shares. The stock looks like it is building technical support in the $10 price level (See Chart) It’s forward PE is under 11 which is an over 55% discount to its five-year average. The median analysts’ price target on XCO is $15 and S&P’s price target is $14 on the stock.
Looks like every one of your 4 reasons was incorrect and in only 3 weeks.
I see 2012 earnings estimates are now over 25% lower than just 60 days ago.
As previously mentioned, as the stock continues down, the target prices are being lowered as well. You think there's many people getting excited about the new $11 Bank of America target? Most the others will be lowering their target prices to $10 to $12...except those who are going to make a statement and get some publicity by saying $5.
Guess where the stock is going to go as the target price estimates are lowered further?
And those thinking Ross is the savior at $15/share? Why is he going to pay you 70% premium over market price? If he buys the company (which he's not), start lowering your sights to $10/share.
You and Feliz need to wake up - you're holding the bag.
I'm sorry, but you're a lost/misguided soul. You are not investing, you are listening to propaganda. Why don't you think for yourself instead of regurgitating what everyone else says/does?
You have not provided one solid reason out of the 4 you provided as to why the stock is dirt cheap.
1. Who cares what Oaktree bought? Here - look at what else Oaktree invested big in:
"The biggest investors in Enron-related debt, according to traders, are Oaktree Capital Management of Los Angeles, which manages $6 billion in funds devoted to distressed securities, and Appaloosa Management L.P., a Chatham, N.J., hedge fund manager that often invests in the debt of troubled companies. Each firm owns Enron and related debt, including the securities issued by Citigroup, with a face value of $1 billion, traders said."
2. Building technical support at $10? I'm looking at the chart and it was building technical support back at $20...until it wasn't. The only technical support being built at $10 is resistance.
3. Forward PE? Show me. I guarantee you that the forward PE will not come to fruition because they will not turn in the earnings to do it. Further, the earnings they do report is going to have caveats all over it (non-GAAP) for "one-time non-recurring items" with a bunch of hand waving to inflate the number. Bottom line, the forward PE is nonsense, the earnings will not meet expectations to do it.
4. Median analysts price target of $15? $14 from S&P? Who gives a rat's a$$? Because before the current analysts median estimate where it currently sits, it was higher. How well did that work out? Before they were wrong, but now they're right? Because you say so? I say that in the next few months, they'll all lower their estimates again, and the price target will be $12...as the stock slides lower towards $8.