Come on Josh! Stop the bleeding... A close below 1/share would be horrific for a great company. Or better yet, buy up 100 million shares right now and sell them for 2 bucks in a week. That would solve any liquidity issues if there are any...
technicals.. . 1.48 was new 52 week low. Probably a mutual fund or large holder had a stop loss at that level.. Next thing you know it triggered a massive sell off and panic selling. Now new buyers are needed to recover the last two day's losses. Analysts love to kick a company when it's down and prop them up when they are skyrocketing.
My take is Citigroup's downgrade caused CJES to break 1.50 which triggered large stop losses. IN minutes 1/share was breached which triggered a whole new round of selling down to 82 cents. Obviously the citigroup downgrade deserved a 5% move down or so since they bring up higher Q3 liquidity risks then maybe the market had priced in, but this 40% move today and over 75% since the earnings is absurd. Hopefully buyers realize that quickly.
CJES management never mentioned any need for dilution. And Citigroup said its a possibility. It's a possibility with any stock. This stock has dropped 75% in less than 24 hours. That's like announcing Chapter 11 type move, which in no way did CJES even come close to mentioning. Anyway, obviously I rebought a day too early.
Prior calls I thought Josh did fine. I really think he might have been hung over or on pain medications. Not the best idea in the world when you are the CEO in a struggling environment. But Josh does know the business side better than any other CEO I've listened to. CJES management could easily have sugar coated the upcoming quarter and this stock would be at 3/share today. Guess I'm glad he had a poor showing and didn't provide sugar coated guidance since I was able to buy back in at a much lower price point. I liked that they are focused on innovating their way to lower costs, and they did a good job of downsizing all service lines. Citigroup downgraded them this morning to neutral and mentioned 400million in possible equity dilution, I hope that's not needed ever but definitely not until the stock prices is back in the teens. That would be a horrible thing for existing stock owners if happened below 5/share. I think Nabors would come to CJES's rescue well before that would happen since they have a 52% stake..
Usually high volume days mark turning points. The last time we saw a day like today CJES moved from 3/share to 6/share. I see a similar move this time. Depending on oil it could have been capitulation.
Rare to see a stock up 20% and down 20% in one day. I've seen this a few times in my life. The Q4 earnings caused a huge spike to 2.63, and the Q1 forecast caused a dramatic fall to 1.70 (so far). I'm hoping the fall was an over reaction (my reason for buying back at 1.75). It does worry me they didn't give a Q1 forecast except except for in line with the overall rig count reduction . I think that's why the market punished them so severely. But I like that they have a 40 million dollar cushion on their debt requirements.
Bought back fully CJES plus gained another 10K shares. I have a ridiculous amount. I really should split it between Nabors. I'll wait for a better opportunity . Both are on a fire sale.
What hurt them is they didn't give guidance at all (first time I believe they ever did this). Only thing Randy said is it should be in like with the US rig count reduction which is about a 30% down quarter over quarter. That unfortunately is a very gloomy guidance and negated this outstanding earnings.
gap filled to 2.02 on the guidance.. but 2/share held so far. I haven't heard the CC on how bad it is.. Didn't sound good based on the earnings release.
So far shaping up as predicted. Took off at the open to 2.63. All depends on the Q1 forecast now which way it goes from here. Will be a volatile day regardless.
Unfortunately we are not talking about a small loss here for me.. No where near CJES management or mutual funds, but a very large one. I have a loss of around 100K on CJES with an average buy in price of approx 3.90 range (started buying at 7/share and kept building my position). I accumulated over 60K shares slowly before selling at 2.55 last week with the intention of rebutting below 2 or above 3. I fully planned to never sell those shares, but the severity of this oil crash has surprised everyone including CJES management. I've made some great investments in the past, but oil investments including CJES have erased most of those gains (for now). I also have large paper losses on Gazprom, BAS, NBR and a few other oil investments. One thing I've learned during this process is calling a bottom is hard if not impossible, so all you can do is pick a top quality company like CJES and hope they make it. So, I fully intend to rebuy those 60K shares and maybe even build on that position over time. I expected earnings today to be brutal and I was wrong so I very well may be rebuying above 3. But the gloomy forecast from the earnings release makes 1.50 very possible as well. Still doesn't change my expectation for CJES to eventually make it and fully recover regardless of which price point we reach next..
So I want to dive in on the open (assuming the gap isn't too big), but CJES in their report gave a gloomy forecast for Q1.
From the report: "The completion services experienced a significant decline in activity at the end of the quarter and this has remained depressed".
Well completion services had almost the exact same statement. This does not bode well for the forecast for Q1 2016 since these make up the majority of CJES's revenue.
But, was a great quarter with a beat on Rev and earnings. Early investors will dive in on the great Q4, and then the sell off will occur during the CC as CJES gives a gloomy (but accurate) forecast.
I'm still very bullish on CJES, but I think we will get another chance to buy in the 1.50 range.
The write down was steeper than I expected (total write down of 7/share for 2015), but adjusted earnings blew away estimates. Should trade up today unless the forecast is super gloomy. Nice they kept the entire cushion on the EBITDA requirement. Looks like 1.50 may not come anytime soon (if ever).
What makes you think Nabors lifts the price? BAS is trading about the same as CJES from hits 2014 highs and it has no relationship like Nabors. In fact, CJES is down on par with most small to medium sized frackers. Nabors should give CJES a slight competitive advantage (along with the Bermuda tax advantages) going forward, but so far they haven't been given any credit for it.
One key to the CC is how much money of the 20 million dollar cushion on the EBITDA requirement to the revolver they used. If they used zero we probably go higher. If they used a good portion of it, this will sell off hard.