Well we have currently stand at 20 after bouncing from 19 and some change.... I will stick to my original forecast and will be selling 18 dollar sept/dec puts to establish a longer position sub in the 16 dollar / share range and hoping for a better year next year with NG prices.
Na...My guess anything below 20 will be a blip on the screen like today. As I said, I think the short term trading range is 20-22 ...The fear for you is that it blows through 30 and end up with two less cows.
Aside from a handful of NG producers that can still make money with prices in the $3 range, why would anybody else drill at these numbers? If I were an energy company CEO I'd cut back dry gas drilling completely and hold the asset in the ground until it was profitable to drill. This is a healthy pullback in a bull run for NG producers.
You do realize UPL is highly profitable at NG prices below the $3 level? They're also only spending capex within their operating cashflow so there aren't really any debt issues. This is a rock solid natural gas play IMO. I don't see this going below $20 unless NG drops below $3.50 for any length of time.
yes. I understand where their cost basis is, but with that kind of build and because of this cool spring we're probably headed to 3.50-3.75 NG. UPL 2013 earnings are estimated at 1.59... don't know why it would justify more than a 12 multiple with that low of gas prices... listen, I am so long term bullish I'm excited about seeing it back to 15-18.... unfortunately, I think we'll be there in the next couple months.