Shares equivalent to 1/2 of the float just changed hands, 8m shares in two days. Some serious sellers were sick of waiting and not convinced that the earlier indications of oil meant Tamandua#1 would be productive. I don't think 8m shares is just a lot of daytraders and front-running automated systems but some of it would have been. And many times one sees these panics just before good news.
I have the impression that the concession area has high probability of being a productive one and the experience with T#1 improves their chances of getting the next well right. Is it feasible to move the rig and get preliminary data within a couple of months?
The other question I am asking myself is: does HUSA have funding for the next well or do they need to issue new shares to finance it? I think one of their statements claimed to have adequate funding but then 8m shares may be expressing doubt as to what they can manage. My guess is that the probability they'll get the next well right is improved and of course in the best of all possible worlds the hydrocarbon flow that gave them problems drilling Tamandua #1 will turn into cash flow.
Anyway the big boys know whether this situation and the potential of the 7 other nearby sites make HUSA undervalued at 7 and if they have conviction, upward price action will tell the story so maybe I'll add shares if it heads up. Friday either finished supply pressures or not.
Its encouraging to have the Cannacord analyst sticking his neck out but 8m shares disagree with him. As you can tell I have zero expertise in this industry but its interesting and feels more likely to be opportunity than a big bust from here... guess we'll soon see.