Until SD comes out with good news or investors shake off the BK fear, SD will likely continue to trade in this narrow range. I suspect oil will rebound some within the next 60 days so that should help.
While I think BK is unlikely, it is possible that if some of the people SD has hired to do restructuring want to go forward with a prepackaged BK deal, then I could see that taking place. At this point, it would seem to be just one of the options on the table. My thoughts about SD not needing to go in this direction still stand but that is based on oil going up soon. If oil stays down, it will be a tough road for many energy companies. Going out on a bit of a limb, I would say that if these companies can hang on during 2016, it is possible once Obama is out of office, a new President may be inclined to support a bailout for stressed energy companies. Since Obama hates big and small oil, it would not happen this year.
SD has 855 million on hand. They have now a 500 million loan. They hedged oil at 90.00 which will bring in around 360.00 in revenue. The Pinion deal saves about 39 million this year. The debt deal with Occidental relived SD of about 200 million in debt and cut operation expenses by another 39 million. In short, SD is making progress working with creditors and will survive the storm.
It is likely that the guy SD brought in to help restructure their debt is behind the new loan. I just do not see a bank doing the loan if they thought SD would be going into BK. My guess would be that SD had to lay out some solid plans to the bank for the loan to be approved. Everyone knows what kind of situation smaller energy companies are in right now. There is no way that bank could not have known. Yet, the loan was done. Given that, I cannot help but see the loan as a sign that BK is not in the works anytime soon.
The bashers will try and turn something positive into a negative. CH 11 would take place if Sandridge cannot pay the bills. There is no indication that will happen in 2016. Oil needs to increase in price so that companies the size of SD can survive. If it stays low, then CH 11 will come into play but that will not be this year. It is very unlikely that oil will stay low for that long.
SD has about a billion in liquidity. They have debt payments not due for several years. They should be ok and not need Ch11 unless oil does not go back up this year. Also, Ch 11 would not be the end of the world if they needed to use it next year. Many companies like SD are in the same boat. I do not vision oil staying below 50 during the next 12 months.
Check that story again. You will find that they were not Sandridge workers. This should save SD money and appears to be a good move with oil where it is.
The Director of Communications for SD has indicated the company as ample liquidity and will trade over the counter tomorrow. Although the stock bashers will try to convince people bankruptcy is near, Sandridge has no fear of that at this time. They should be fine until the oil prices rebound. I am convinced that delisting is the best option in view of the market going down and oil being down. This company will rebound strong.
SD can appeal the decision but I doubt they will. I suspect they will breathe better and wait on oil to go back up.
Shorts and plunging oil prices kept driving the stock price down. A reset button is needed and that will be provided by delisting. Meanwhile, oil should stabilize over time. I thought they might do a stock buyback but why do something to raise the stock price if low oil prices and shorts would take the stock back down again?
The regular bashers are on a tear right now because they do not want people buying SD. This is part of their full time job. SD They will try to keep negative post at the top throughout the day. SD is making it through the storm and has been acquiring more drilling rights. Common sense would let people know if they were in trouble, they would be selling off their holdings instead of acquiring more.
Zack's Research has rated SD has a value stock. They do that when the stock price is well below the value of the company. They anticipate the stock price increasing over the next year. This is based on the company doing nothing to increase the stock price. If the company takes action to get the stock price up, then SD stock is more of a value now than most people realize.
SD is sound enough for now. Most experts think oil will recover later this year. I it does not, then Ch 11 might be an option down the road. Ch 11 is for when they cannot pay their debts. There is not problem in that area now. I do not see it being a problem at the present time. Ch 11 and the current stock price have nothing to do with one another.
As far as I am aware, the deadline is January 25th. There have been post by some on this board that indicated that SD could ask for more time. The impression that I have is that SD must be making progress regarding getting the stock price above a buck. At present, they seem to be making no progress. They could allow the stock to be delisted. They could go forward with a reverse split or they could do a stock buyback. Time is running out and we should soon know what SD management has in mind. Just a guess----nothing more----but I would tend to lean toward a stock buyback as a strong possibility. As the second option, I would say they may allow the stock to be delisted. This is based on the theory that due to low oil prices and hard times for drillers, a reverse split may do more harm than good. It may be that to allow a delisting is the best option out there.
Do you know something about the reverse split that I do not know?? The last info I saw on that indicated that if SD management decided to do a reverse split, it would come up at the 2016 stockholders meeting. They may well go in that direction but I have not seen anything to indicate a decision has been made about that. Until oil prices start trending up, I maintain that a reverse split would be disaster as there would be no reason for the new stock price to stay at the higher price.
SD is looking better and it is driving the trolls crazy. Is it not really strange that they did not take Christmas off in order to post on this board? There is a reason they are working so hard on a Saturday morn. Chances are, we will have some really good news about SD within the next 30 days.
The only thing SD has to do is to hang in there until oil prices rebound. Signs are that OPEC is suffering from trying to put American companies out of business. At some point, they will try to push oil prices back up to around 70.00. It is likely that will be sometime in 2016. Given the situation, SD has done well.
Why 70 cents? That would be ok if the stock were at least 30 cents before it went up. SD needs the stock to be a buck to stay on the exchange. The question is whether or not SD management has a trick or two up the sleeve to get the stock price increased? A reverse split would hurt investors. Yes the stock price would increase but the number of shares one holds would be greatly reduced. If a ratio to 20 to 1 was done, it would be bad. On top of that, once he reverse split is done, it is likely the stock price would fall like a rock because SD's financial situation would not support the higher stock price.