"SN has had 25%+ short since inception." - Your statement is simply incorrect. A year ago short interest was only about 10%. Short interest didn't break 15% until last December and it has moved up significantly since then. I agree about SN's good balance sheet, relatively, so I have to think the short thesis is a bet on weak NG pricing altho other NG weighted cos. were green yesterday [Antero, Range Res.]. The dramatic increase in short interest (50% higher since Dec) does give me some pause and I don't think it should be dismissed lightly.
I'll answer my own question- weak and weakening NG and NGL pricing which is more than half of SN's production. But they do have 60% of total production for this year hedged, or at least that was the figure as of the end of February. The percentage is likely higher now.
The question I have is what do those 35% shares short see that longs don't? That level is twice as high as it was when the whole oil market was tanking and the price was more than double current levels. Shorts have been piling in since this bounced of the $7ish lows in December
Yeah, the only thing I hate worse than having my investments go down, is not having the foggiest idea why they are going down when it seems they should be going up.
Oil up a buck and half and this still can't catch a bid. Some shorts want to educate me?
So I re-read yesterday's PR thinking I must have missed something but I couldn't find any negatives. I did see one positive that I overlooked - a subtlety stated INCREASE in guidance quoted below. I guess it was too subtle for the market to appreciate:
"Based on first quarter 2015 operating results and second quarter expectations, the Company currently anticipates that full-year 2015 production will trend toward or exceed the upper end of current guidance provided for average 2015 production, which is an increase in guidance considering the divested Palmetto volumes which were previously announced."
The company is operating within its cash flows, reducing costs, and increasing production and guidance. I'll be patient though frustrated.
Sentiment: Strong Buy
Yeah, I totally don't get why we are so weak today and underperforming the sector. Makes no sense to me.
Initiates coverage with a sell and $9.50 price target? Ha, ha and right after they get a good credit line redetermination and the opportunity to push back debt maturities from 2018 t0 2020. Wall Street analysts at their finest.
Sentiment: Strong Buy
I can't offer much substance to this other than I've always heard the Hillman family had a substantial position in this issue. I guess that is the reference being made. Evidence of the "clout" can be seen by the fact that the company has gone thru several private equity purchases and sales yet the preferred has not been called. In the low interest rate we've had for years now, what private equity firm in its right mind would not have called an 11% preferred if there weren't understandings/agreements or other considerations in play beside pure economics and financial mgmt.
If someone has more substance to this, I'd love to hear it myself.
It was an interesting insight to the views of some holders. Perhaps some even think there is a constitutional right to the continuation of an 11% preferred- or so it seemed :-) More seriously, I hope some of these holders aren't that too dependent on the income stream from this issue.
Never heard a CC before that had almost all individual investors :-). All asking about the preferred, its continuation and recent volatility. If I was around, I should have called in to ask a question myself. The question begging to be asked and wasn't, "How and why is it this issue hasn't been called yet?"
Maybe next quarter. :-)
From the conf. call: I wouldn't ascribe much to the volatility this week. Thinly traded and very little volume traded caused the volatility.
Don't scare me like that with a one word post that says 'redeeming" when just correcting your typo of "redeeding" LOL.... made my heart skip a beat.
Yeah, somebody dumped 15K at once late afternoon. Nobody does that in a thin issue like this unless they are trying to take out stops.
This company has gone thru a number of private equity transfers of ownership and the preferred has not been called. While I can't argue with your premium sale- if I didn't own in a taxable account I would have done the same- but I am not sure the change in directors is something to focus on. I have always heard that insiders own most of this issue and, if true, I am guessing that a condition of these transfers is that the preferred remains outstanding. That's the only reason I can see that an 11% preferred hasn't been called during this prolonged "easy money" environment.
Exactly flat per today's report. 3K increase from Alaska. Perhaps the beginning of a new trend reflecting the huge decline in rig counts.
Sentiment: Strong Buy