As the old saying goes, "the only truth is the tape" and the tape said $10.16 at the close today. Who cares what Barclay's said or thinks? The buyers today didn't care about targets and downgrades.
As a long, I sincerely hope you're still chortling after Q results tomorrow.
When an institution wants out, buyers sure sit on their wallets. WTI is trading in a $49-$51 band and BBG's cash flow is pretty well assured for 2015, but when you forecast little to no growth, you get thrashed and get no credit for the intelligent hedges and debt reduction. Crying shame.
PQ has weathered downturns before and is pulling the right levers to do so again. The question is whether NG goes under $2 in September, or heaven forbid, sooner. Sellers under $3 seem to think so, I suppose, and will re-enter PQ in the fall shoulder season.
The first analyst action I've seen:
Today's News, February 26, 2015
Bill Barrett Corp. Cut to Neutral From Buy by SunTrust Robinson Humphrey (Dow Jones)
The really dumb analysis of results put out today by the Motley Fool and Cramer's rag hasn't helped either, but I hope the retail investor would have listened to the call before trading in reaction. On a busy conference call day it's hard for an analysts to put out a quick, cogent note to clients to buy the dip, but anyone who did served their clients well. Buying tomorrow won't be too late either.
This is crazy cheap. I just got some at $9.84, spending what little dry powder I had. Maybe the sellers see oil at $40 on a sustained basis, but I sure don't. Only time will tell.
"...Comstock also announced that one of the financial covenants in its bank credit facility was recently amended such that the maximum ratio of total debt to EBITDAX was increased from 4:1 to 5:1 for 2015. The Company expects to be in compliance with its bank credit facility financial covenants throughout 2015."
Now we can get back to worrying about NG prices and returns in the Haynesville.
MarketWatch deleted their 66 to 55 target reference and is now just citing the downgrade from Cowen. Looks like a screw up at MW.
"MRD exchanged its East Texas and non-core Louisiana oil and gas properties for all of MEMP's non-operating interests in the Terryville Field and cash consideration of approximately $78 million
Transaction highlights include:
Transitions MRD into a "pure-play" Terryville Field E&P company
High-grades capital program to higher returning Terryville assets..."
This reserve news and the 1Q guidance are indicative of the reliable job Watson is doing, but they aren't needle movers, I'm afraid.
Sold at $5.50 and back in at $5.02 on the dip in WTI crude. The shorts want this to trade below $5.00 to see what shakes out for the margin issue, so the pain could continue here for a while.
I added at $3.14 this morning for the well results coming from the two Cotton Valley 100% wells. No reason not to think they won't be very good. Good webcast from Charlie this week from EnerCom.
Two things caught my attention in the webcasts from EnerCom in SF this week that pertain to TPLM. Marshall Atkins from RJ said the technicians on their research staff think the bottom for CL was made in January. The fundamentalists think it will be made in May. Second, the analyst from GMP said pressure pumpers will be the best performing service group coming off this bottom, out performing the drillers which performed best the last cycle. Listen to the BAS call replay from today and you hear in response to a question from Marshall that pressure pumping margins are now down 25% headed to down 30%.
CLR recently took off its hedges and the general rule of thumb is you need to hedge in support of an acquisition or have a well endowed hedge book already established. The strip won't yet support a hedge program that will justify paying a premium in an acquisition.
Jim Cramer said this morning on Squawk Box the coming M&A in the patch will likely be at the $3/share level, instantly doubling the target. David Faber began the conversation, saying his banking sources were suddenly focused on the patch, witness the 13G filings, etc. I immediately thought of AXAS and PQ, maybe CRK, but it's a lofty $5.