Yes i agree when they drop all refineries in to the mlp thevreal value will be unlocked but the market expects this fully so it will be priced well before.
What i dont agree with is you talking about dilution as a foregone conclusion though. They are financing 550 with a 7 yr note and are on schedule to report about $330-350 million of net income this yr. if we assume taht the brent spread will remain above $10 and the added cash flow from the acquisition there should be no reason for any additional financing
on etrade - but it gives no details - hopefully they have a high price target as well. We made the jump to $36.90 this morning as soon as this upgrade hit my account, so I don't think it is wrong info
UBS upgrade - couldn't find the price target though
Below is from the presentation and it sounds significant!!!
Five-year contract extensions on the Hercules
261 and Hercules 262
Total potential revenue of approximately $465
– Equates to an average dayrate of $125k - $130k
per rig, an increase of over 50% from current
– New dayrates will commence in late 4Q14
Strong indication of customer’s desire for, and
longevity of jackup rigs of this class
Positive reflection of Company’s relationship
with world-class operator
Commodity Units Price Change % Change Contract Time(ET)
Crude Oil (WTI) USD/bbl. 107.97 -0.83 -0.76% Oct 13 09:15:51
Crude Oil (Brent) USD/bbl. 114.99 -0.17 -0.15% Oct 13 09:15:41
It's $7 now
hope the spread gets closer to $10 and stays there - and it could happen with Egypt situation
I missed the CC and am listening the tape now. The excuse we got for no contract for discover rig yet is bc the co is looking for a long term contract and is not considering anything under 12 months! He also said they have not been the lowest bid on a number of occasions.
it sounds like bs to me and they seem to have set their own expectations to high on the day rate.
I hope the analyst asked more questions on that
Ahhh "how did they know" - another reminder that we are but pawns in this game. Hey nor where do you think the BI/WTI spread is going.
why do you think it is HERO's responsibility to start a relief well - I think the owner/operator of the well decides that and should bare the cost - in case of macondo remember the big penalties went to BP not RIG or HAL
I don't think shorts piling up is anything good. As this is a small cap co in a high risk business enough convicted shorts can run it to the ground easily. The fire has certainly made situation much worse. Before the fire there was this statement from HERO
Experts from Wild Well Control Inc. were to assess the well site overnight and develop a plan to shut down the flow of gas, said Jim Noe, executive vice president of Hercules Offshore Inc, owner of the drilling rig where the blowout occurred.
Noe stressed that gas, not oil, was flowing from the well. He said it's an important distinction because gas wells in relatively shallow areas — this one was in 154 feet of water — sometimes tend to clog with sand, effectively snuffing themselves out. "That is a distinct possibility at this point," he said. "But until we have our Wild Well Control personnel on the rig, we won't know much more."
I hope that HERO's strategy is not to wait for sand clog!!!
It really is a shame as the co had really turned a corner. Now it's much more important to get the discovery rig under contract - which is a long time coming.
hard to be a shareholder right now.
when does the fleet report come out?
As a result of this concern, Macquarie downgraded CVR Energy to Underperform, and Valero and HollyFrontier to Neutral. The kept ratings for the rest of their refiners, but said they’d keep a close eye on things.
So they didn't touch their rating on WNR but we're the ones getting pummeled - the others have recovered half of what they gave up in the morning!