BIG UP DAYS ahead
Of course news of lower U.S. production and OPEC’s expected production cut spread positive vibes. OPEC has a lot higher target of 70 dollar oil. But what added momentum to crude is the story of short covering. By definition, short covering indicates the purchase of commodities which have already been sold short. This is usually done when prices witness an upward movement.
Moreover, the news of oil price rise is good for oil drillers as their expected rig demand is positively correlated with crude prices. Small cap oil companies are down fro 70 to 90%
Here, the short sellers were expecting crude price to fall and were eagerly waiting for the right moment to make profits. But all of a sudden oil started rising. Hence, to arrest losses the short sellers were forced to book profits by buying the commodity. As more short sellers booked profits, oil price surged more than 5% in the last three sessions. Small cap oil seem to be motivated. ******************Oil is slippery and we never know which way it might flow tomorrow. If as long as its prices keep rising, smart investors should build positions in the stocks mentioned above to ride on the momentum. ************************
We all know this is way to cheap. We blame the economy, climate and trend and over look why we invest. ITS THE FUTURE DUMMY... BUY BUY BUY
DANGER when oil stocks move against the barrel falling. THE FOOT IS coming down!!!!!!!!! hort the debt of shale drillers who may run into cash-flow challenges.
There are plenty of different ways to design a trade. But the general consensus is that oil prices are moving lower. And in this instance, the farther oil prices fall, the more confidence traders have in a theme. After a year of declines, many traders have large unrealized gains built up, while slow-moving investors may finally be deciding to sell shares or set up new bearish positions.
So what if something good happens for crude oil? Maybe nothing huge, but a small data point that "could" lead to strength? Well, with so many traders parked on the bearish side of this theme, the ripple effect could actually be quite big!
• Traders with leveraged positions and accumulated profits built up may buy to lock in gains (helping to push prices a bit higher)
• Investors and traders late to the game now have small losses, and some of them decide to cover (moving oil prices or energy stocks just a bit higher).
• As prices start to pick up momentum, hedgers like airlines and transportation companies start to lock in long-term rates while prices are still relatively low.
• Market makers who supplied the hedgers with protection now have to offload their own risk, buying crude oil futures and other energy exposure.
• Now investors who sold at the low
with a 19 dollar book and breaking even on earnings they look great . They are not in debt trouble and lower then the industry norms.
Barrett Bill 7%
Barrett Bill 7.625%
Barrett Bill 9.875%
Barrett Bill Cv 5%
Because most investors are a lot smarter then you. Figure the balance sheet out. Price/Earnings TTM 6.3 —
Price/Book 0.3 1.0
Price/Sales TTM 0.8 1.6
Rev Growth (3 Yr Avg) 43.1 -13.1
Net Income Growth (3 Yr Avg) — -16.5
Operating Margin % TTM 5.6 -15.7
Net Margin % TTM 13.1 -16.5
ROA TTM 3.1 -4.8
ROE TTM 5.3 -10.7
This DEBT to Equity shows you it almost has twice the assets to debt
every body through out oil. The capitulation in the industry and Goldman doom calls is a buy signal. The 20 dollar oil calls were as bad as Goldman's 200 dollar oil calls in 2008. Exaggerations both ways.
Momentum is growing fast. FUNDS beware Barons wrote by By Amey Stone
Talk about a comeback. Upstream master limited partnerships, as measured by RBC’s Upstream MLP index, were up 28% over last week through Thursday. Those gains compare to just a 6% gain in the broader Alerian MLP index and a 4% gain in the S&P 500, according to a Monday report from RBC Capital Markets.
Despite the heady gains, year-t0-date the Upstream MLP Index is down 53%, compared to the AMZ’s and the broader market’s 23% and 5% declines. The crash in oil prices, of course, is to blame.
Linn Energy (LINE) is the top rebounder in the group. It gained 59% last week, but year-to-date is down 65% through Thursday. As of 2 p.m. ET Tuesday, the shares were at $3.70, a 4.5% gain that day.
Mid-Con Energy Partners (MCEP) and LRR Energy (LRE) both recovered by 36%, the next-best rebounders after Linn.
RBC analysts John Ragozzino and Elvira Scotto wrote of current valuations:
The upstream MLP group continues to trade at a steep discount to historical levels on the continuation of a depressed commodity price environment. The upstream MLP group currently reflects an average current yield of 24%, and 5.1x EV/EBITDA multiple
maybe at 6 dollars?
Get a life and clue PROFITABLE and increasing DIVY... TURDS cant read or find others increasing divvy.
YOUR AN iDIOT IF YOU THINK THERE IS NO OIL WHERE THEY ARE LOCATED- North Dakota (Bakken and Three Forks formations in the Williston Basin) and northwest Colorado (Piceance Basin).
we now have about 85% of our projected oil production hedged at roughly $72.00 per barrel, DO YOU REALLY think they will have a acquiring buying frizzy and heavy CAPX spending? The whole sector boomed and took on debt. This story is no different then any body else in the sector. Your kindergarten rants are not backed by intelligent questions. EVEN the divvy is going to retire debt instead of being a profit enabler. So you must ask your self , IS PPS APRECIATION possible? I say yes, and a good catalyst being over sold.
China and DOW money if funds that have to be fully invested should notice the only sector not over bought. I bet you shorts will love the run for the door. ONCE they see the huge gains again the oil sector could ignite for 15% gains across the board again.