I see it. I think Avista was actually part of the initial underwriting. Their stake is not recent.
I think $20 would be more like it from these levels unless they have a poison pill provision in their by laws. Send the link to the Avista position.
At these prices, HCLP would be a great acquisition for a big oil company, driller, hedge fund, etc. They have the assets in the ground and a decent business model. If someone offered say $20 it would be a steal. It's a buy here just on this possibility.
That would work but you would be long at 15 instead of 12.50. I think the stock can go a little lower especially with tax selling coming up. You can get $100 for a naked Jan 12.50 put. This lowers your cost to 11.50. If the stock does not get down to 12.50 you keep the $100.
At some point, if they survive, this company will be a BUY. It's been hammered from 70 down to the current 15 level but is still profitable. I would not buy the stock here right now but would sell the naked 12.50 puts out 6 mos. or so. If the stock declines below 12.50, you can cover the puts or take the assignment and be long the stock at 12.50 less whatever you received from the sale of the puts.
The IPO was at 18 not 14. The future depends on fracking activity which is tied to price of crude. If it picks up quickly, they should survive. If not, they will burn cash and who knows how low it will go or even if they will survive.
Agree. New US drilling is ceasing at these levels. After a feeble technical rally earlier in week, HCLP down another $1.25 today. I hope they make it.
Rigs are up?? No way. Look at SDRL, RIG, etc. HCLP had rally yesterday from combination of short covering and a small increase in crude. It resumed it's downtrend today. Earnings coming Aug 6. This will be interesting.
It all depends on when fracking picks up and if they can stay in business that long with sharply reduced orders. Fracking pick up depends on price of crude which has no chance of rebounding any time soon. It's not profitable to frack at these prices. This is why stock is in a free fall.