Friday even though it was a down day, most of the volume was buyers that came in. This is a fact demonstrated by the bid/ask sizes all day. The majority of time bid size was huge compared to ask.
The shorts thought they would make a killing and they have not so far. Now they are stuck with a SHORT SQUEEZE. Most of them with any sense are going to cover. They know this is not the catastrophe they hoped for.
Top 4 Small-Cap Stocks In The Oil & Gas Drilling & Exploration Industry With The Highest Cash (NOG, HERO, VTG, CTE)
By Lisa Levin
Below are the top small-cap oil & gas drilling & exploration stocks on the NYSE, the NASDAQ and the AMEX in terms of cash.
Northern Oil and Gas Inc (AMEX: NOG ) had $191.84 million in total cash and no debt for the latest quarter.
Hercules Offshore Inc (NASDAQ: HERO ) had $136.67 million in total cash and $864.07 million in total debt for the latest quarter.
Vantage Drilling Company (AMEX: VTG ) had $120.44 million in total cash and $1.11 billion in total debt for the latest quarter.
SinoTech Energy Limited (NASDAQ: CTE ) had $108.38 million in total cash and $9.46 thousand in total debt for the latest quarter.
BEACON EQUITY RESEARCH
Hercules Has Fallen: is it Time to Buy HERO?
Posted by Dave Goodboy on Apr 08, 2011
Shallow water driller Hercules Offshore ( Nasdaq: HERO) has been knocked off of its multi-month uptrend by international bribe allegations. Shares were stopped dead at $7 per share when rumors of the bribery investigation started swirling about the financial community. The official news hit the wire on Thursday when the company admitted that it was being investigated by Federal law enforcement authorities. This investigation is on the heels of seven drilling companies agreeing to pay $236 million to settle foreign official bribe claims in November. In addition, the oil and gas industry operates in nations believed to be, by U.S. officials, among the most corrupt in the world. This has resulted in the U.S. ramping up anti-bribery enforcement leading to the Hercules investigation. The company has operations in the fraud capital of Nigeria, among other shaky economies, creating even more suspicion among overzealous officials.
Let’s take a closer look at Hercules. Thrust into the spotlight as being a driller in the wake of the Gulf oil spill, the company took advantage of the situation by buying out Seahawk Drilling at a substantially reduced price. The Houston, Texas-based driller together with its subsidiaries, provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry in the U.S. Gulf of Mexico and internationally. The company serves integrated energy companies, independent oil and natural gas operators and national oil companies. As of February 24, 2010, it owned a fleet of 30 jackup rigs, 17 barge rigs, three submersible rigs, one platform rig, a fleet of marine support vessels, and 60 liftboat vessels, as well as owned four retired jackup rigs and 10 retired inland barges located in the U.S. Gulf of Mexico.
Looking at the history of this type of bribery allegations, it is very unlikely that they will damage the company financially. This pull back creates an opportunity for savvy traders to obtain shares at a discount. However, it’s important to keep in mind that anything can happen when this can of worms is opened, no matter how unlikely. Caution is warranted at all times. Good trading!
Small Cap Stock Analysis
Energy Companies With Plenty of Cash That Continue to Benefit From the Oil Rally: CTE, VTG, HERO
Oil Names With Plenty of Cash and Bright Horizons
By Don Seal
Published: April 8, 2011 8:18:05 AM PDT
No doubt the recent oil rally has investors thinking whether there is another bubble forming. Will this rally be sustainable or is it merely another tactic to drive up the prices? Few small cap companies such as Sino Tech Energy Limited (NASDAQ:CTE) and Vantage Drilling Company (AMEX:VTG) are seeing their shares accumulated as the oil continues to trend higher.
After touching its 52-week low of $4.75 back in December of 2010, Sino Tech has reversed its course and has been trading close to its 50-day moving average. After its recent drop to $7.25, it surged back up again to remain above its 50-day MA of $8.06. This is definitely a bullish sign as the stock is clearly in a consolidation mode. Out of 58 million outstanding common shares, there are currently 59,000 share shorted.
Vantage Drilling on the other hand had a recent insider purchase on March 28th. Thomassen Steinar quietly scooped up 5,000 shares at $1.92 to add to his 30,000 share position. Observing the six month chart, there are no evident charting patterns that one can decipher.
However, the stock has a tendency of trading above or below its 50-day moving average of $1.95 with a $0.15 standard deviation. Let us see if the stock will remain above its 50-day MA on the last day of the week. From 289 million outstanding common shares, 5.3 million are currently shorted.
Despite its high debt levels, Hercules Offshore (NASDAQ:HERO) also makes our list as a premier stock to benefit from the oil rally when nothing changes fundamentally that is company specific. This Houston based company was even subpoenaed by Securities and Exchange Commission for possible violations.
China primed for change in fuel pricing
By Leslie Hook in Beijing
Published: April 5 2011 17:34 | Last updated: April 5 2011 17:34
The last time oil prices soared in 2008, the rise prompted Beijing to change its oil pricing system to follow international prices more closely.
That reform resulted in what we have today: a loose guideline by which the government adjusts pump prices every couple of weeks to keep them in line with international prices.
Here is how it works in theory: if a basket of crude prices rises by more than 4 per cent in a 22-working day period (roughly a month), then the National Development and Reform Commission will consider adjusting pump prices.
However the NDRC, which is responsible for economic policy and planning, does not necessarily have to adjust fuel prices if it does not want to. Furthermore, the powerful ministry has other duties in its portfolio, such as taming inflation which in theory should be helped by lower petrol prices.
In practice the management of Chinese fuel prices works slightly differently. China’s last pump price adjustment was on February 19 and the price of Brent has since risen by more than 15 per cent.
So, the country is overdue a fuel price adjustment. But, although the guideline is that China’s pump prices should follow an international basket of crude prices, the question is to what extent will the government let high crude prices filter through.
“Our understanding is that this time, if the oil price rises to about $130 per barrel there’s a good chance that government may slow or stop the rate of adjustment,” says Minggao Shen, China equity strategist for Citi. “This year will be a bit different [than 2008]. The key is if the Chinese government is able to slow GDP growth a bit, then the ability for China to take in a higher oil price increases.”
Oil refiners like Sinopec and CNPC are a major pressure point in this system. Unable to pass on the higher crude cost to customers on forecourts, refiners suffer losses. In 2008, this resulted in some refinery shutdowns, although, as state-owned enterprises, both companies are expected to continue refining. The state pays refiners to keep going: in 2008 Sinopec received more than Rmb50bn ($7.6bn) in subsidies.
Some analysts believe that continued high oil prices could force China to again reconsider its pricing mechanism and move towards a less discretionary system. “There’s been a lot of talk about whether further revision ... is necessary, but latest discussions indicated there has been no official change,” says Soozhana Choi, head of commodities research, Asia, for Deutsche Bank.
But if refiners are hit this year as hard as they were in 2008 then pressure from the likes of Sinopec, a powerful political entity, could speed the reform process.
Latlong is right. Good observation. There were more bids most of the time. If it was not for the large bid sizes the day would of gone much bloodier. Before hours the stock lost 14%. In the early morning, the bids pushed the prices higher. But, then started collapsing. The fear is too high. The ignorance in the management is stupendous. They must come out talk to share holders. We small investors need to stay a side for a few days and watch. It is not important when we get in. It is important to get in when it is moving upward.
It can go either way. My fear is this stock will go further down.
That waiting part might apply to those who were not already in but for those like me who were already in.. well, we were in for a reason.
This surprise doesn't surprise me.. I added on Friday.
Nothing wrong with a company using money to make money. Most companies do what HERO did and its added to ' cost of sales.'
There are buyers and sellers, but one or the other is in control. Rather there is demand or supply.
It was demand for most of the day after the initial fall. 2 lines at the theatre box office. One is short (no demand and plenty of supply - tickets go on sale). The other has a line around the block and the theatre can only seat so many. Ticket price goes way up.
Your comment is showing you to be naive. You did not make any point.