This company is like dead man walking now. The recovery of oil prices are purely based on lowered rig counts. That means the recovery of oil prices are based on killing the business of this company. The investors here are so silly to bid up the stock price just because the oil prices are up. That is a totally wrong move. The only thing that will save this company is if there is increased capital investment in oil exploration, not decrease. Less rig count is less business for this company and very bad news for this company.
My point was even if the rig counts down that gets the oil prices to stabilize, this company is still heading for deeper trouble because the mechanism (less rigs) that caused the oil prices to stabilize is the same factor that will kill the company. This is oil equipment and service company. Rig count down is same as saying sales down for this company. Do you understand that?
One primary reason that I am very bearish on this stock is because even the recovery of the oil price will be based on the death of this company. Think about it. The only news that caused the oil prices to be up recently is the rig counts are down. What does that mean to this oil equipment and service company? It means that even when the oil prices are up, the business of this company will be down. The recovery of the oil prices will be based on killing the business this company. Any simple minded investor that bought this stock purely based on oil prices will be dead wrong. This company will be out of the business even when the oil prices are up if the oil price recovery is based on cutting rigs.