CJES and NBR were both around 32/share at the time of the merger announcement June 2014. Now Nabors is valued 120% higher than CJES (12 vs 5) which is only due to CJES's small cash position and high debt it took on to triple it's business with the merger deal. This should even out as both stocks move higher with oil prices. I'm looking for both companies to trade north of 15/share by end of year if oil can rebound.
looking like we are closing just south of 5/share.. . but a 60% move up in 3 trading days isn't too bad!
it make perfect sense to everyone.. then it rebounds from 37 to 45 and it must be short covering.. Really??? Oil still has to go 150% to make up it's one year losses and this is short covering???
If oil goes to 45 we might see 5/share. a lot of shorts on both CJES and Oil having to cover their positions today. CJES was 7/share when oil was at 42 so doesn't make much sense for CJES to be below 5 right now
when I first started buying 2 weeks ago at 7/share oil was exactly at this level (42.50). So basically oil is unchanged yet CJES is 50% cheaper.. I like those odds going forward.
Today's 23% climb may seem impressive, but keep in mind this was 300% higher just a month ago. If sentiment changes this could go back to the teens in just a few months.
CJES ended just off the high of the day up 10%. We didn't make a run at the 52 week low for the first time in a long time. And CJES did this despite oil being down today.
This stock is down 90% on the year, and is valued pennies on the dollar and yet shorts are piling in now thinking it's heading for bankruptcy. Any morning they could wake up to an offer 100% or more above it's current market cap offer (not that CJES would necessarily accept it), or better yet CJES may just slow grind back up with oil over the next year or two to make all time highs.
From a value standpoint Cjes is dirt cheap. The debt and oil of course are weighing it down. Either one of those gets fixed Cjes is a 10 bagger in a few months. If neither gets fixed it keeps getting even cheaper.
Just for comparison, CAM is an oil field services and was bought today by SLB for 2.5x it's book value at over 12 Billion. Even taking out goodwill, that would be 15/share on CJES if i got the same buyout offer. If you include goodwill that same buyout price would be 25/share.
740m is about a 1/3 of the assets listed (6/share of value). So if you take out Goodwill CJES is still trading at about 1/2 it's remaining book value of 6/share. Not quite as impressive but still very cheap.
Seems CJES collapses if oil falls and is flat at best when it rises. Now trading at 5X below book value but value metrics are meaningless until oil stabilizes and the market gets some reassurance about their debt payments I suppose.
Hopefully CJES will come back in line with Nabors and not the other way around. I think the market is favoring Nabors due to the better cash balance, but since it has 3x CJES debt not sure how much the cash on the books helps. Both are insanely cheap if oil can recover in 1 year. If not both are in trouble I suppose.
If you combine the Nabors fracking segment earnings plus CJES in 2014, the current market cap equals 2014 EBITDA. Obviously oil is half the average oil value of 2014, so there is good reason for the enormous discount, but it does show how cheap CJES is if oil ever recovers.
Since oil is erasing it's slide from yesterday, you would expect CJES to erase its 20% loss and close around 4/share or higher. If it somehow closes red or flat, this is institutional and perhaps even insider massive selling..
truly amazing... I've never experienced a day after day attack of a stock quite like this (no sustained dead cat bounce). Of course 90% drops in stocks are fairly common, but weeks of day in day out 10% or more drops is something I've never seen. I can't imagine what major shareholders like senior management and mutual funds are thinking at this point. Would love to be a fly on the wall in their kitchen to see if they think this has a chance to turn around.
wow.. that was strange . high of 4.80 after hours and low of 3.20. seems legit trade volumes too. Nothing would surprise me after these last few weeks. Never seen a stock since day after day 5 to 15% like this.. Relentless.