If I owned oil reserves and faced low pricing environment, I'd want to keep my inventory/assets in the ground and wait for a market recovery, rather than deplete my inventory at fire-sale prices. A race to the bottom just doesn't make any business sense.
""We suspect their projection of current prices into the future will again be frustrated by the market."
Yes, there's a human tendency/bias to extrapolate the current into the future.
Yes, the market tends to throw curve balls.
Ok, to give equal time to the other side--listen to this video interview on CNBC.
"Oil trader Andy Hall has closed out his bearish bets on oil and is predicting a price recovery in crude sooner than many analysts expect."
"if production continues to grow here (as is forecast for next months at least) and storage does fill up, thus removing one source of demand, the price of WTI should fall, all else the same."
I'm not sure.
The problem is that demand doesn't respond immediately or quickly--there's a lag.
Yet, for producers (or even consumers who may want to buy)--where does the excess supply go if storage is not available?
Seems to me that producers will cut production first and which will keep prices steady (not drop) or possibly lead to modest increase.
I just saw an article announcing: "US running out of room to store oil; price collapse next?"
Someone help me through the thought process, please.
If storage is nearing capacity, ie. no more place to store oil, doesn't this put a lid on production increases? When storage is full, doesn't production equalize with consumption so that there' no net need for further storage? And, if true, doesn't attainment of supply/demand equilibrium lead to stable prices (instead of a collapse)?
"You are so deluded."
No, it's basic accounting principles.
Too, there are lots of examples of firms who go through periods of negative earnings (and positive EBIDTA), sometimes quite extended periods, without BK. Not only no BK, but eventual (sometimes spectacular) recoveries. AAPL in the late 1990s is a prime example--it was literally days/weeks from zero cash.
Sorry if facts don't fit your prejudices.
"Negative shareholders equity is not a catalyst for bankruptcy. "
Certainly not to service interest--you're absolutely correct.
However, positive equity and operating income certainly impacts the borrower's ability to deal with debt maturity---either pay off or refinance.
These are the context of my original comments (I agree with you !)
Let's be clear: EBITA is a better indicator than earnings of a firm's ability to service its debt (earnings before interest and non cash charges---closely approximates cash flow), at least in the short/medium term.
JCP's fy14 earnings are, indeed, negative (after debt interest service), and it reduces shareholder equity. And, shareholder equity is still positive at fy14 end at ~$2BB, meaning that JCP is not in any imminent danger and has the time/means to continue its turnaround.
Mr. Muckle may be a tough guy on anonymous MBs, talking tough.
But, Ms. Hillary has achieved far more in her life, made a far greater difference to this nation, so far than he ever will.
If he were to look in the mirror---what do you think he'd see?
A click of the mouse and rascals like Mr. Muckle are dismissed forever.
You've nailed the essential points (including in your other post).
The volume today clearly signals institutional buying--that's why the share price has turned around from the initial plunge.
JCP is really interesting, provides insights into short-term oriented, impatient mentalities. The HUGE strides that M.Ullman et al has made in the past 2 years is completely ignored. The turnaround continues---I suspect that not only will the share price be much higher by year end, but the cast of characters on this MB will also be quite different.
Not unexpected---there was bound to be profit taking after such a sharp run year-to-date.
Q4 results were decent, indicating that JCP is making the right moves in its turnaround. (those who wish to see quantum leaps are bound to be disappointed.)
+4.4% comps in top line is no manipulation, nor is the + 5.4% increase in gm. The $57MM increase in free cash flow is another.
You can close your mind--but let's avoid baseless allegations. There's no miracles nor shortcuts in this turnaround--JCP is doing hardwork and steadily moving forward.
Oh, no. You're not kidding anyone--you own title of Wacko, posting non stop.
Let, go, buddy. You really need to learn to let go and get on with a life off these MBs.
Dirty Harry's words come to mind, as we all mosey on down to the OK corral:
Uh uh. I know what you're thinking. "Did he fire six shots or only five?" Well to tell you the truth in all this excitement I kinda lost track myself. But being this is a .44 Magnum, the most powerful handgun in the world and would blow your head clean off, you've gotta ask yourself one question: "Do I feel lucky?" Well, do ya, punk?
"Or is this the Yahoo equivalent of road rage?"
Internet tough guys like eranger don't impress me, they're impotent fools. It's so easy to dismiss them---takes just a click of the mouse to vaporize them.
See, these guys can't even beat a mouse!
I wonder what would happen to HLF's financials if it were to do away with signup/annual fees paid by its distributors?
ie, rely 100% on product sales?