27
Apr

T.G.I.F.

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Market Sentiment Watch: Lazy Friday in front of a busy E&P earnings week next week. In today's post please find the gas storage wrap and comments on HGT, KOG (grr arrgg), SSN and more. The group and market have a little better tone to them now as we approach the heart of energy earnings season and I have been adding to positions at a slightly quicker pace (see Holdings watch below). 

Ecodata Watch: 

  • 1Q12 GDP revision came in at 2.2% vs 2.7% expected and an earlier edition of 3.0%,
  • We get Consumer Sentiment at 9:55 am EST (F = 75.7%).

In Today’s Post:

  1. Holdings Watch
  2. Commodity Watch
  3. Natural Gas Inventory Preview
  4. Oil Inventory Review
  5. Stuff We Care About Today –- KOG, SSN
  6. Odds & Ends

Please click the link right below this to 

Holdings Watch

ZMT (Zman Medium Term portfolio):

  • Yesterday’s Trades: None

ZLT (Zman Long Term portfolio)

  • Yesterday’s Trades:
    • REXX – Sold one of the trading positions taken earlier this year at $10.25, essentially flat to cost. I'm shifting some gas exposure but remain quite long in the name. 
  •  
    • MPO – Added to the core (call it 3/4 full now) at just under $15,70.   Same thoughts as yesterday, no new impetus for the trade, just rounding out the position before coverage comes (probably 4 weeks out) and 1Q12 earnings (they will get a little longer to report since they just came public so probably very late in the 1Q12 pack of earnings). Expecting the name to get positive sellside ratings when coverage does arrive unless the name has advanced well above the previously expected IPO range.  By mid year people should start looking to 2013 numbers and I expect the name to start to look very inexpensive on those vs just inexpensive on 2012 estimates if they can push towards another year of high double digit growth which should be doable based on their project inventory.  

The Blotter is updated.

Commodity Watch:

Crude oil edged up $0.43 to close at $104.55 yesterday with the help of a strong looking/feeling equity market. Geopolitical rhetoric remains fairly low despite the approaching deadline to stop trade with Iran. I would expect that to change in coming weeks. This morning crude is trading off slightly. 

Natural gas eased 4 cents on the June contract which took over front month duty for natural gas this morning, closing the day at $2.13 yesterday after EIA reported an inline inject that was well under the 5 year average for this week of the year and also a minor downward revisions to storage estimates of 11 Bcf, spread out of the last four weeks. The slope of the injection line continues to look flatter than what a casual observer of rampant natural gas supply growth would like expect especially during the shoulder season but electricity consumption has been running high to last year in recent weeks and natural gas has been capturing increasing share from coal as has been oft talked of of late. This morning gas is trading flat. 

Natural Gas Storage Review

ZComment: Steady as the injection line goes. 

– 

Stuff We Care About Today 

KOG Operations Update – Lower Than Expected 1Q12 Volumes

The following is essentially an augmented version of what I wrote in comments yesterday evening. 

  • KOG reports 1Q12 volumes of 10,578 BOEpd. This was up 47% sequentially which sounds nice but the growth should be coming from their two acquisitions and I had modeled a bigger numbers. I'm probably not alone in that …
  • …KOG Probably Well Below Consensus Model On The Quarter. KOG likely led people to a higher number by giving the near year end 2011 exit rate of 13,700 BOEpd (original company and acquired volumes combined) followed by a late February 2012 then current rate of 15,000 BOEpd … few analysts are going to model you close to 10,000 BOEpd with this kind of exit rate and mid quarter comment.  Not without more guidance.  Do that often enough (and this is not the first time I've felt Lynn was light) and people won't trust you.  They point to a "previously disclosed shortage of workover rigs" as the culprit for getting new wells on artificial lift. When you put a well on pump, the well goes down entirely so they apparently had several wells off line prior to February … still I think they could have handled this better.  

 

  • Other Items:
    • They list 3 completions but give only 1 rate at Grizzly. Could be not yet flowing back, not sure, but the singel rate of 900 boepd is encouraging for that area,
    • The lack of progress in remediating the six wells is not welcome news but as of IPAA in mid April they had only repaired one well.  Two done out of 6 and only one completed and that at a rate that tells you probably very little. Moreover, the other 4 wells likely won't be on until 3Q, shoved back from early comments targeting the end of 1Q12. 
    • I'd say the problems that analysts belabored on the 1Q call are not exactly "behind them" unless you count not using those liners again in the future.
    • No current rate given in this press release … maybe they are thinking putting a current rate in print isn't such a good idea at this point.  
  • They Are Not Lowering Guidance:   My thought is that not lowering the rate again given the first quarter's performance puts more onus on the back half of the year's individual well performance. So less breathing room there and unless the production increments just became more lumpy it is hard to keep the fully year guidance the same AND the exit rate the same unless you knew that the 15,000 BOEpd rate you quoted in prior press release was, again, beyond worthless as an indicator or quarterly production, suggesting that they had big IP flush production in the number and didn't care that it made them look like they were stepping up on the acquired volumes when in fact that was not completely the case.
  • Nutshell: I  can see some lowered PT's in the morning. I don't so much care about the well thing, that's more a function of workover rigs most so they say and that problem is known in the Basin, but the point int time flow rates given during the quarter were, it turns out, beyond useless, as taking wells down to put them on pump took a lot of barrels out of the quarter. 

SSN Operations Update

  • Montana Bakken – not a huge amount of data but positive
    • Gretel II – drilling out the plugs after removing the fish from the vertical (perf gun and one plug). Next step flow back, next step, build production facilities. I'd expect an IP in a few days to two weeks on the outside. They don't build production facilities for dry holes. 
    • Australia II – said 600 barrels of oil flowed during the time it took to drill out the plugs and flowback the frac water before they shut it in. Doesn't really tell me much other than there is oil there since we don't know how long all this took but it doesn't sound like a boomer of a well. 
    • Abercrombie – CLR operated long lateral in the same area, 0.75% interest for SSN, no IP given, said 18 bo flowed prior to shut in. That tells me just about nothing. Its a 29 stage frac and it possible we will get to hear about the well from CLR next week on their call as they have been particularly active in Montana and in this area of late. 
  • Goshen County, WY
    • Defender well getting its jet pump this week. Too much gas has made the rod pump malfunction. No comment from the company on HAL making a decision on well #2 yet but that deadline is the 30th. I'll lob a call in for comments there. 
    • Spirit of America #2 – this is a redrill of the conventional deeper targets in the Goshen seen on seismic. The rig arrives May 1. 

Other Stuff:

  • Apologies, have not done HGT justice yet, will have a little piece out next week
  • Names that we care about reporting next week:
    • APC,
    • FST,
    • ATW,
    • CHK (well this should be fun),
    • GMXR,
    • XCO (gassy, hugely leveraged, want to hear game plan),
    • GSX,
    • GEVO,
    • REXX,
    • OAS (pre announced volumes, could be a boost to guidance either now or most likely with 2Q call),
    • CLR (big quarter),
    • VLO (time to listen to a refiner again),
    • EXXI (big quarter),
    • PVA (can handle the debt and should have EFS well results to show off),
    • PXD,
    • DSX (time to listen to a dry bulk carrier speak),
    • EPL (looking for best in show on EBITDA / BOE this quarter here),
    • FSLR (time to listen to see if they are going to die or not),
    • KOG (bump call),
    • PQ,
    • SD (not for me but I know some are interested),
    • SWN (2 Brown Dense well results),
    • SFY,
    • UPL, 
  •  Also next week we;ll have another look at new energy IPO coming next week. 

Odds & Ends 

Analyst Watch:

  • TBA in comment. 

176 Responses to “T.G.I.F.”

  1. 1
    zman Says:

    SYRG – gets credit line boost, this one has not been moving well of late. I still don't own it but am watching. 

    Analyst Watch

    KOG – Canaccord cuts PT by $1 to $11, stays Buy

    KOG – Macquarie cuts target from $12 to $8.75 and goes from Outperform to Neutral … this is the kind of knee jerk reaction I expect from this firm who was completely wrong on BEXP before it was acquired. 

    CRR – Howard Weil cuts target from $132 t $108 – asleep at the wheel

    CRR – Barclays cuts target from $157 to $125 – also asleep at the wheel

    CRR – BMO cuts target from $150 to $130 – and yet another 

     

     

    WLL – Barclays ups target by $5 to $79

    WLL – SunTrust ups from Neutral to Buy

     

  2. 2
    choices Says:

    HGT-no worries-it is not like you do not have anything else to do.  Appreciate when you get to it.

  3. 3
    elduque Says:

    Aloha
     
    Status quo for all 3 items:
     
    TED unch at .38
     
    BDI  + 8 to 1156
     
    Brent/WTI   15.4
     
     

  4. 4
    zman Says:

    KOG – BMO was at 12.2 MBOEpd for the quarter … their opening line. "Not good."  Saying they are "show me" mode. Can't blame them for that. Lowering production below company guidance. Keeping target at $12 and rating intact at Outperform since their target is NAV based. I find all that to be fair. 

  5. 5
    zman Says:

    re 2 – Will shoot for Monday, thanks for understanding. 

    re 3 – thanks and good morning. 

  6. 6
    Stewart Says:

    Z..anything in the SSN update to move the needle or just more waiting?

  7. 7
    BirdsofpreyRcool Says:

    KOG – ugh.  Have always found Lynn to be credible and honest.  He is well-liked by the services industry for being fair and living up to his contracts.  I don't know what exactly happened… but it's not good.  That's all I have to say at this point.  Disappointed.  (But not selling my shares.)

  8. 8
    Zorgnak Says:

    S&P Futures Short Term Areas Of Interest ..4/27 5:46am ..S&P Futs @ 1400 Homework Notes.
    Market rotation on strong OTF demand to upper balance area. Bulls  in control above 1397 with
    support at 1394.50. and resistance at 1401.50. Expect a break above 1403 to target 1413 and above.
    1392.50 is the pivot for the current range and the canary for this move higher.

     
    S&P Futures
    http://www.charthub.com/images/2012/04/27/ES_Weekly.png

     

    Glossary
    CLVN= Low Volume Rejection Area – CHVN = High Volume Acceptance/Congestion – VPOC = Most Accepted Session Price
    NVPOC = Previous Session Balance  – OTF = Other Time Frame Money (Big)
    1413          Major Acceptance, CHVN
    1406.50    Resistance, CLVN
    1403          Congestion, CHVN
    1401.50    Resistance, CLVN
    1397          Acceptance/Congestion, MCHVN
    1394.50    Support, CLVN
    1391-92    Major Acceptance, Range Pivot
    1387.50    CHVN, O/N Low 1386.50
     

  9. 9
    zman Says:

    re 6 – its more positive than negative in that they don't build production facilities for dry holes but the tone is pretty subdued and there is not rate give on any of the wells … more waiting but with all the mechanical issues at the two Montana Bakken wells results and news soon from the CLR Montana Bakken well it should have a greener tone to it during the wait. I plan to cal Terry Barr today to see if I can get more color but he doesn't always pick up. 

    re 7 – I'd certainly like to know March production and current.  I'd like to know what they have done about access to workover rigs. If you look at NDIC data you can see that most wells in the Williston get put on pump sometime in their first year of production. You can also see that this takes 10 to 15 days and that are generally declining into this event often rather sharply in the months prior to going on lift. If you take a well down or in this case multiple wells down to put them on pump I would think you'd have the workover rig on hand to do it so am a little confused myself over the magnitude of the dip that must have occurred in January. I would also not that WL and OAS,and presumably CLR did not have this trouble during 1Q12 although the workover rig shortage in the Basin is real and not isolated to KOG.  

  10. 10
    zman Says:

    KOG premarket – not at all getting slaughtered. I bought that trading position lower than this earlier in the week … unless it gets whacked today I won't add more. Conference call is next week but they spilled the beans on anything catalytic in this press release. 

  11. 11
    Zorgnak Says:

    Don't see much in the pre-mkt that stands out except for KOG
    Energy ETF's are quiet

  12. 12
    elduque Says:

    thanks Zorg for the continuing morning update. 

  13. 13
    Dillon Says:

    For what its worth, concerning SSN – I dont know how long it took them to drill out the plugs on Australia II and when they started measuring oil that has flowed back but on average it takes around 15 minutes per plug to drill out if everything goes smoothly. There can be tripping to the surface for various reasons in between each plug, washout/flush time of solids in the well, as well as tools getting stuck to all slow things down. I believe they had around 7 plugs remaining to drillout, so I would think this should be able to easily be done in a 24 hour period. Still a lot of unknowns though.

  14. 14
    Zorgnak Says:

    S&P 1397  key level today…gap close and acceptance…bulls strongly in control above this level…below look for test of 1394.50..1401.50 near resistance…1403 key number on the upside

  15. 15
    Zorgnak Says:

    KOG…looking for KOG to struggle around this 9 acceptance area…support at 8.50 held
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1.png

  16. 16
    zman Says:

    re 13 – agreed, not normally a long process but I based on past releases they took longer and I would say that the 600 bo is broken up over a longer period of time.  

  17. 17
    zman Says:

    Thank Zorg, group has an increasingly better tone to it.

    Noting several of next week's reporting companies are rising into their reports.  SWN moving better into earnings next week, 

    KOG putting a fear into the Bakkens today but not much and would expect OAS and CLR to be moving better into their reports next week. 

    Also noting things like BCEI back over $21, they report later and I would expect them to be above old highs by the time they do as that will be a well heavy press release. BCEI is likely to raise guidance either this quarter or at latest next quarter.

    Would think MPO continues to march up to coverage in the next 4 weeks.

  18. 18
    Zorgnak Says:

    Light volume pull back generally….so far
    High Relative Volume stocks and Price % Change
    CAM    1.50%
    ECA    1.46%
    XEC    1.25%
    WLL    0.65%
    COG    0.61%
    PWE    0.40%
    EXXI    0.32%
    LINE    0.19%
    XCO    0.15%
    CVX    0.02%
    END    0.16%
    TPLM    -0.83%
    SD    -1.63%
    MHR    -2.85%
    KOG    -2.52%
    CHK    -2.79%
     

  19. 19
    Zorgnak Says:

    XOP holding where it needed too

  20. 20
    Zorgnak Says:

    S&P testing support. 1394.50..XOP breaking lower now 55.37 support

  21. 21
    ram Says:

    Zman, yesterday's last entry from West: do you think this is where E&P's next big play will be?  IF so, what are the little guys that could be affected more? Thanks.

  22. 22
    Sheentaa Says:

    Z : been MIA for a while (playing a lot of golf), but over the past few months have been do some reading on the Permian basin and it seems to me that of the onshore oil plays it may have the most upside potential over the next 5 years. I noticed that several Permian related names have been mentioned on the site over the past 2-3 weeks, including several from West a couple of weeks ago, You also mentioned in passing you were looking for Permian pure plays. One name I have not seen mentioned is Concho (CXO) which as best I can tell, is the largest Permian pure play. Seems to have strong acreage positions in all the right places and has a core operation drilling relatively low risk verticals in Yeso and Wolfberry that throw off enough cash to essentially fund the horizontals in the Midland and Delaware basins. So they +/- 10% self funded. 62% oil with production growth of circa 20% in 2012.
    If it's not on your watch list would you mind taking a quick look at some point ?

  23. 23
    Zorgnak Says:

    Bulls need to step in here above 1392…pivot for rotation

  24. 24
    zman Says:

    re 21 – I don't really buy into next big play as much as I do many big plays progressing.  I'm not a big holder of Permian targeting stuff. I wrote up LPI and like West I'd consider myself a fan but I don't own it. 

    re 22 – The Permian names have been mentioned around here for a long time, its hot but I'm fine with my limited exposure via a few names. The Permian plays do have upside, but its popularity seems to come and go over time and but never gets counted out. It's hot right now but its not my focus.  I used to work for Parker and Parsley guys who left when when PXD was created out of Mesa and P&P so I've gotten an earful on the virtues of the Spraberry.   I haven't looked hard at the area but read the stuff that comes across from the likes of RRC and some other exposure I have there. I guess I don't feel like I'm missing much by not focusing too much on the Permian.   Pure play would be AREX but its expensive. I've looked at Concho a number of times and never bit, will look again. I think the Williston will prove to be just as good over time as more pays are added.  EFS as well. 

  25. 25
    zman Says:

    Sentiment came in at 76.4

  26. 26
    Zorgnak Says:

    XOP…..E&P testing brreak out level from previous consolidation
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_2.png

  27. 27
    zman Says:

    That LPI write up was here

    http://seekingalpha.com/article/313986-laredo-petroleum-new-permian-player-with-upside

  28. 28
    Zorgnak Says:

    s&P futs…volume build support at 1394.50

  29. 29
    Zorgnak Says:

    Relative volume still light on the pull back
    High Relative volume stocks
    CHK    -2.22%
    KOG    -3.50%
    ECA    2.18%
    COG    -0.32%
    SD    -1.83%
    XCO    -0.88%
    MHR    -3.80%
    CAM    0.58%
    LINE    0.33%
    OXY    0.38%
    EXXI    -0.06%
    SGY    0.25%
    PXP    -2.81%
    PWE    -0.00%
    TPLM    -0.15%
    ROSE    0.78%
    CPE    0.00%
    XEC    0.69%
    GLNG    -0.45%
    IO    -0.98%
    OAS    -1.05%
     

  30. 30
    Zorgnak Says:

    Again …filtered by % price chg
    ECA    2.22%
    XEC    0.80%
    ROSE    0.80%
    CAM    0.78%
    OXY    0.42%
    LINE    0.28%
    SGY    0.25%
    CPE    0.00%
    PWE    0.06%
    TPLM    -0.15%
    EXXI    -0.13%
    COG    -0.27%
    GLNG    -0.45%
    XCO    -0.58%
    IO    -0.98%
    OAS    -1.05%
    SD    -1.83%
    CHK    -2.19%
    PXP    -2.64%
    KOG    -3.41%
    MHR    -3.80%

     

  31. 31
    zman Says:

    ZTRADE – ZLT – PVA

    PVA – Added to the Core at $4.95. They should have more Eagle Ford well results next week and am expecting a coming downgrade in their borrowing base to have already been baked into the share price at this point, with the lower borrowing base not further significantly impacting their drilling plans for 2012. 

  32. 32
    zman Says:

    MPO moving again. heh, heh

  33. 33
    zman Says:

    MPO piece on SA

    http://seekingalpha.com/article/514801-midstates-petroleum-ipo-pricing-too-cheap-to-pass-up

    If you have a minute, please sign up to follow our free stuff at Seeking Alpha … its free. 

  34. 34
    elduque Says:

    Z- what did I miss on the ECA quarterly? I never saw what they said differently to prompt this rise?

  35. 35
    BirdsofpreyRcool Says:

    FTK filming an episode of "Stocks Gone Wild."

  36. 36
    zman Says:

    re 34 – Dunno, I don't own it and I have not had a chance to look at the transcript yet. I suspect it's up on this small rise in natural gas prices and more people starting to think that gas demand is going to be very strong this summer.  A lot of the gassy names are making this exact same move right now.  

  37. 37
    zman Says:

    re 35 – nice base breakout there. 

  38. 38
    RB Says:

    re: 37…beeg volume on the break too….

  39. 39
    zman Says:

    Phone call Friday watch:

    Call in with WHZ on timing of first distribution, other questions. 

    Call in with SSN

    Next up MPO

  40. 40
    Zorgnak Says:

    S&P 1398.50 is intra-day resistance…

  41. 41
    Zorgnak Says:

    HK….10.80 and area of interest….potential resistance
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_3.png

  42. 42
    choices Says:

    from Alpha-jeez:
    The Sierra Club says it will block Dominion Resources' (D+0.6%) plan to export 1B cubic feet per day of Marcellus Shale liquefied natural gas through the company's Cove Point, Md. terminal. A previous legal settlement gives Sierra Club the ability to reject any significant changes to the purpose or footprint of the existing terminal.

  43. 43
    zman Says:

    re 38 – would guess a sellside firm said something. 

    re 42 – saw that, they are using a law from the 1970s to go after the plan. 

  44. 44
    Zorgnak Says:

    CLR…pulling back to the 88 level on zip volume…beginning to build some volume support above 88
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_4.png

  45. 45
    Zorgnak Says:

    S&P futs working on 1398.50  resistance…see a test of resistance and O/N highs(1401-3) should it give way

  46. 46
    zman Says:

    Zorg – how much time do you need post IPO for any kind of a read? 

  47. 47
    Zorgnak Says:

    #46 very little on a day trade

  48. 48
    Zorgnak Says:

    Can get a read on the day of the IPO…but only with defined risk

  49. 49
    zman Says:

    CRR just broke prior support, will be reading transcript in a bit. Stock looks to be headed mid $70s…. I'm thinking I am a buyer down there but not yet decided. 

  50. 50
    Zorgnak Says:

    make any sense?

  51. 51
    Zorgnak Says:

    Also depends a lot on how liquid it is….WHZ and WPO were pretty tame

  52. 52
    zman Says:

    Zorg – Actually, it wasn't a very good question on my part.   BCEI looking like a tightening flag to me with an eventual tip of the flag on lower volume at $20.50. Reports later in May, should have a bunch of wells to talk about in the HZ Wattenberg, which could be enough to push them to raise guidance or, and this is what I expect, they don't bump guidance until 2Q but it will be blatantly obvious that they are going to by the 1Q call. 

  53. 53
    Zorgnak Says:

    CRR…there is a low volume node at 83.21…could be something to lean on with defined risk

  54. 54
    Augusto Meoli Says:

    Zorg – Sorry for the ignorance, but what is a low volume node?

  55. 55
    Zorgnak Says:

    LVN=low volume node= a low volume area=an unfair price that is likely to be rejected……which way is the trick….so not an area to blindly act but an area of interest to watch for market reaction

  56. 56
    Zorgnak Says:

    #54 High Volume Node= an area that has found acceptance by both buyers and sellers. High volume indicates an area where both are in agreement and trade is easily facilitated. Usually acts as a damper on momentum as price arrives there

  57. 57
    Zorgnak Says:

    CLR 88 level is a HVN

  58. 58
    Augusto Meoli Says:

    Zorg – Sorry, one more time. Is it determined by a number of volume transactions  which shows that buyers stepped in at that price? Where can I read more about your nodes? That may help in the future , so that I do not ask dumb questions. Which means I will ask other dumb questions!

  59. 59
    Zorgnak Says:

    #54 no need to apologize…..as the boss says there's no such thing as an ignorant question…we're all learning here

  60. 60
    Zorgnak Says:

    #54  Here's how the idea of High volume node and Low volume nodes looks on CLR today.
    Price hit's 88, a high volume node…slows down…hits low volume node LVN at 87.80 ..and is rejected upward…..I hope. Does it always work. No. That's why I define the risk. If it doesn't act as I expect I am out, then and there.

  61. 61
    Zorgnak Says:

    CLR chart
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_6.png

  62. 62
    Augusto Meoli Says:

    Zorg –  CLR has breached (bearly) the $88 HVN, you would expect a bounce and the stock to regain momentum. Otherwise there will be a new HVN adn LVN at a lower price?

  63. 63
    Zorgnak Says:

    #58…be happy to help…after hours is best though..pretty busy during market hours

  64. 64
    Augusto Meoli Says:

    Great!! Thanks. I will chat with you then.

  65. 65
    zman Says:

    Even overly leveraged, gassy gassy XCO starting at least a brief rally. 

  66. 66
    Zorgnak Says:

    S&P 500 futs..balancing at the 1397 level…intra-day .resistance at 1398.50 support 1396.75

  67. 67
    Zorgnak Says:

    #62…Context is everything. The market, group and in this case the Bakken Group has to be weighed along with the individual stock action

  68. 68
    Zorgnak Says:

    #62 everything in the Bakken group is struggling today because of the KOG follies

  69. 69
    zman Says:

    re 67 – yeah, kind of silly for a name like OAS (since they already announced a big beat on volumes) but an oppy for those wanting in pre quarter.  TPLM not paying attention to the KOG news today.  

  70. 70
    RB Says:

    in my opinion, at least to some extent, we are seeing that it hard for all these nascent oil companies to execute their game plans….kind of like the NFL only so many good QB's/coaching staffs….too many teams; too little talent to go around….

  71. 71
    Zorgnak Says:

    #69…ha!..thanks..just noticed that…

  72. 72
    Zorgnak Says:

    OAS and WLL look poised to shake it off

  73. 73
    RB Says:

    FTK blows past prior high….that's what high volume break outs do….great action…thx for putting me aboard

  74. 74
    Augusto Meoli Says:

    ZMAN – Have you considered selling KOG? It sounds like there may be better opportunities out there, in the near future.

  75. 75
    RB Says:

    'ya know among friends, I am about to admit how big an idiot I am….I'd thought perhaps Z was a bit too boolish on the overall economy….so I went to Investopedia to find out what an L shaped recovery was, if in fact they even defined such a thing….hard for us old simpletons sometimes but the net is full of tools to help us understand…..L shaped recovery mirrors what Japan has had where everything muddles along and oil keeps getting used….I'm comfortable with that…wish the hell I'd looked it up sooner

  76. 76
    Zorgnak Says:

    Stewie just went long WPRT…fwiw

  77. 77
    Gtinvest Says:

    Zorg great comment #67. in that same regard, the ng transport stocks. seem to be acting the same way, GTLS had a great earnings call  yesterday, Fsys,Clne, and WPRT , trying to bottom an turn. Can you look at the technicals?

  78. 78
    Zorgnak Says:

    WPRT…
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_7.png

  79. 79
    zman Says:

    re 74 – Considered before and did sell some in the mid $10s in February but no, not on this news. I think they will be fine long term. I think this was handled poorly by them. I think they will recover just fine over the course of this if they are not taken out sooner. 

  80. 80
    Zorgnak Says:

    WPRT….
    29.85 Support…the latest stuck longs at 31.23…….

  81. 81
    Augusto Meoli Says:

    Zorg – Who is Stewie?

  82. 82
    Zorgnak Says:

    HK…broke 1063…lots of volume back and forth here..looking for 10.80 next

  83. 83
    zman Says:

    Traderstewie over on Twitter, he has a big following, he's all technical. Sent him FTK this morning. WPRT is very much a momo name so that's naturally going to be up his alley. 

    About being in context – this is part of why I don't use price targets. Valuation is relative to the expectation of the commodities, how the group is trading, how the direct peers within the group are trading and the broad market. I think price targets are point in time useful only and of very little use at that point depending on how they are derived with the NAV based ones being only useful on the day the company is acquired other than just making sure that the stock is within some sort of ball park that makes sense.

  84. 84
    Zorgnak Says:

    #81…a swing trader that Z knows…NOT a recommendation to trade it…he is pretty good but very short term

  85. 85
    Augusto Meoli Says:

    CRR – lot of action at $83 ish!

  86. 86
    Augusto Meoli Says:

    #84 well I took it too. It looked good! Thanks …so far.

  87. 87
    Zorgnak Says:

    S&P futs..still struggling below intra-day resistance…order flow is negative….no edge here either way on the day

  88. 88
    Zorgnak Says:

    #86…one last word…he can move a stock and he's part of a large number of very twitchy traders that are likely already scaling out of the position..when it stops going up…look out…

  89. 89
    elduque Says:

    Z- Fadel Gheit at OPCO: on a scale of 1-10 how would you rate him. Just came out with positive comments on CHK.

  90. 90
    Augusto Meoli Says:

    Zorg – Thanks. I am day trading it myself. As I do not know much about WPRT. It is nice to have made money for a couple of good dinners for me and wife over the week-end. Now holding only 200 shares out of 1,000. Thanks again.

  91. 91
    Roger Says:

    Re 79 KOG  To make their low end 19k BOED for the year after doing less than 11k in first quarter, they will need to average right at 22k for  the last 3 quarters. Is that doable ?

  92. 92
    Zorgnak Says:

    S&P 500 Futs..bid/ask delta turning towards the bullish side…looks ready to go again

  93. 93
    zman Says:

    re 89 – He's very good. 

    Agreed, Stew is very short term, but he's pretty good early for the quick trade. 

    re 91 – yes it is, the program is back end loaded, always has been, now apparently more so. I don't see a shot at them raising guidance all year long and they will be scrapping to get to current guidance but given the program didn't change and even given that 2Q won't be near 20,000 BOEpd for an average they could still do it. It just won't be easy. 

  94. 94
    Augusto Meoli Says:

    Z –  I just noticed your response on my  KOG question. I did  not noticed it before. I will hold myself. 
    Re 83 I have been following Stewie myself for a while. My opinion is that he gets 50% right at best. However, this was a great set up. as the stock bottomed yesterday and broke a two days high when Zorg reported it. 

  95. 95
    zman Says:

    BCEI and MPO smiling. 

    Waiting on call backs this afternoon. Guessing I get tabled until Monday. 

    PVA trying to move higher. Thinking pr Monday on the revolver unless they just put it in with the quarter later in the week. 

  96. 96
    RMD Says:

    bot a little FST.  Reasoning : cc on Tues, heavily shorted, think the 7-8,000boed Hogshooter well is theirs.  Bad news : that well is most likely just a one-off sweetheart well , way above the average.  Also hear APA may talk about the Hogshooter later next week. (This is not my usual MO, so it probably won't work.)

  97. 97
    zman Says:

    Augusto – hear ya on that and all I know about Stew is energy related, don't pay attention at all to his other stuff. Also note that I never day trade, I'm not good at it. So when you ask about KOG I'm generally going to be looking out through the current swale.

  98. 98
    zman Says:

    RMD – thanks, haven't heard anyone mention Hogshooter play on the site in a quite a bit. 

  99. 99
    zman Says:

    KOG – this is not the negative knee jerk reaction …. Lynn obviously was laying the ground work for this at IPAA. 

  100. 100
    Zorgnak Says:

    WPRT at wide low volume area….could reject in either direction…..watching how the market treats it this time..
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_8.png

  101. 101
    elduque Says:

    gas rigs down 18. 

  102. 102
    Augusto Meoli Says:

    Z – I am here to hold stocks as I think that with this board there is knowledge and not technical trades. However, I like to spice up my day and I daytrade what I do not really want to hold, if the right set up comes out. For instance WPRT was exactly what I would look for. I took it for a 10 min. ride. Nice gain. My question on KOG was because I heard you somewhat negative and was not sure if the situation has changed for the long term. Now I know. It is a hold. 

  103. 103
    Zorgnak Says:

    XOP actually gapped higher on high volume on the last  little pop..don't see that every day…
    http://www.charthub.com/images/2012/04/27/XOP.png

  104. 104
    Augusto Meoli Says:

    EXXI trying to go positive. great set up.

  105. 105
    zman Says:

    Augusto – Thank for the question.  If I'm ever not clear (and some of this stuff gets written in the wee hours of the night so that can happen) just ask for a clarification. 

    Rig Count Watch

    613 gas rigs is a new low for this cycle. 

     

    I like today's chart

    http://chartporn.org/

  106. 106
    Zorgnak Says:

    Crude back to resistance..top of current range
    http://www.charthub.com/images/2012/04/27/CL_Weekly.png

  107. 107
    zman Says:

    re 104 – may take some calls pre earnings next week there

  108. 108
    Zorgnak Says:

    HK getting lots of volume here..trying to break higher….

  109. 109
    Augusto Meoli Says:

    Z thanks, but the total number of rigs for oil and gas combined is going higher. That is good. When/if gas goes back to $4 then we will have a nice uptick on rigs. Meanwhile the total number is going up.

  110. 110
    Augusto Meoli Says:

    EXXI if they mention "Dividend" this stock should explode.

  111. 111
    zman Says:

    Crude in "what me worry?"mode … after so many calls for a fall by talking heads as it approached $100 last week.  WTI looking ahead to Seaway reversal and my thought that Iran won't stay quiet much longer.  And then there is Sudan's war heating up, likely more trouble in Nigeria soon and Saudi and Kuwait pumping away at max recent history rate. 

    http://www.cx-portal.com/wti/oil_en.html

  112. 112
    Zorgnak Says:

    S&P futs…1403 O/N high

  113. 113
    zman Says:

    re 110 – I really hope they do not talk about adding a big dividend, I think the money is much better directed into their project inventory.   I do not expect them to do anything significant along dividend lines. 

  114. 114
    Augusto Meoli Says:

    re 113 See, that is what I mean when I say I do not know much about this oil business. I thought they had enough free cash flow to give some money back. Oh well,  that is why I am here.

  115. 115
    Sheentaa Says:

    BOP: PVA bonds in the 93/94 range. Do you think that clarification of the redetermination will, by removing uncertainty, put more of a floor price, or are there other greater uncertainties dominating here ?

  116. 116
    Zorgnak Says:

    KOG over 9..all is forgiven

  117. 117
    zman Says:

    re 109 – Good for some. I want the gas rig count to continue falling as natural gas prices "fix" natural gas prices. I don't think $4 does it for gas rig counts. A halt in the decline and a modest bounce. But gas projects will compete on economic basis with oil in most dry gas areas only above $6 and probably $8 / Mmbtu, once they have fled the gas basins. The total number going up is in general helpful to Service companies but may not be so welcome for hoped for 2H12 Service inflation rollover in places like the Williston Basin. 

  118. 118
    Zorgnak Says:

    HK…a ton of sellers at 10.75
    http://www.charthub.com/images/2012/04/27/Stock7.png

  119. 119
    zman Says:

    re 114 – Most E&Ps do not pay dividends. EXXI is generating excess cash and paying down debt more rapidly than they had planned. To keep growing they need to put more dollars into more projects and they have an inventory that runs out several years meaning that some but not all excess cash could be used to bring some wells forward in time. Staffing becomes an issue at some point … you can only run so fast with the staff you have while doing a good job but I'd rather see them take down leverage more and do more projects than buyback shares or payout a dividend that then locks them into paying out a dividend. 

  120. 120
    zman Says:

    MPO at $16.50, not bad for a week's worth of trading. 

    BCEI marching on prior highs. 

  121. 121
    BirdsofpreyRcool Says:

    sheentaa — #115 When we first started talking about the PVA bonds they were offered around 99 and change.  However, once high yield funds start selling, it's usually a good bet that the bonds go lower.  It takes a lot more work to find a buyer on the other side of a bond transaction (unlike stocks).  So, not worried that the bonds are 94 offered now.  I had no idea how low they would go… just that the trend was such that they would probably continue to drift down.
     
    Well, drift down they did.  It's a combo of high yield analysts universally buying into the "weak management" comments + low (and went lower) nat gas prices.  I bought my bonds around a 10.5% yield, as I was happy with that level.  At 94, you are getting a 12.25% yield to maturity. 
     
    It will be interesting to see if the bonds move up significantly, post bank redetermination.  I am guessing we will see a point or two, back to 96 or so… but once bondholders decide to sell, you have to find new bondholders to buy back in.  And at low nat gas prices, this might be a slow grind back up to par (100). 
     
    But am I worried?  No.  Not unless PVA management lives down to their reputation and are unable to capture more oily production.  But if that happens, the stock will take it a lot harder than the bonds.
     
    Does this help?

  122. 122
    Justin Says:

    Anybody have the link to the cartoon about E&P's growing NAV at all costs? Remeber it or am I nuts? I believe it was talking hippos. That was a funny but relevant point.

  123. 123
    Skeptcl Says:

    Z—any thoughts on XCO in front of earnings next week? Do you think all the negatives are priced in at these levels or do they have another shoe…or twelve…to drop? I've seen some positive chatter recently on it, but my fingers are bloody stumps trying to catch this knife. 

  124. 124
    zman Says:

    re 121 – I knew Baird Whitehead, now running PVA, from his days at COG. I don't think he's a bad guy and seemed technically competent at COG    They've drilled 40 wells in the Eagle Ford so far with average IP's just over 1,000 BOEpd (89% oiil) and 30 day rates averaging 675 BOEpd.  They trade at about $1 / Mcfe on reserves and are cheap on forward multiples as well 

    They've been on the wrong side of gas prices to be sure but I'm not sure what else would be wrong with their reputation?   I saw you mentioned this yesterday and again in #121 and would like to know more about what people are saying.  Well performance in the EFS looks solid to me, and that's really all they are focused on this year,  so not sure what about management so bad about them 1) maybe too much debt that's done and not something they can live down to or 2) being on the wrong side of natural gas which would convict management at SWN, RRC, COG, UPL etc of the same thing. But if somebody is saying something I want to hear it. 

  125. 125
    zman Says:

    re 123 – no, nothing fresh. I will not be an owner in front of their numbers. I'm not sure all the negatives are priced, have not been keeping up with how their redetermination will or has fared, I just want to listen to them talk. I actually liked what I heard several months back when they emerged from their go private effort (unsuccessfully) and they ave been rumored to be a possible bankruptcy. 

  126. 126
    Zorgnak Says:

    TPLM coming back to the scene of the crime…wouldn't be surprised to see some selling come in for a bit
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_10.png

  127. 127
    zman Says:

    re TPLM – no plans by me to sell yet. Still holding last 1/4 opening position in ZMT and calls. 

  128. 128
    BirdsofpreyRcool Says:

    re:  PVA management comments.  I'm not condoning (I don't know management here).  But I have friends at high yield funds and who are high yield sell-side analysts.  I have no idea why (except they cite "poor execution") they say "weak management," but they do.  So, when people ask why the bonds are weak, just passing along comments from the institutional high yield chatter.
     
    I did not press the couple of people I spoke to about PVA bonds as to"so what do you MEAN, 'weak management?'"… they are friends and ex-colleagues and I didn't need to cross-examine them.  Just wanted to know why PVA bonds were offered so (apparently) cheaply.  They answered.  I passed that answer (and that perception) along as one of the reasons why the bonds are weak.  Really, if you are comfortable with managment's ability to "get oily," does it matter what the details are? 

  129. 129
    zman Says:

    re 128 – thanks, just trying to understand why you kept knocking them. Now I do. 

  130. 130
    zman Says:

    re 112 – I don't have a link to that but here's one on gas prices. 

    http://www.youtube.com/watch?v=40hNSJEKUgo&feature=relmfu

  131. 131
    BirdsofpreyRcool Says:

    Just to be clear:  I have no personal basis to make that comment.   I marched through the debt part of their cap structure and felt comfortable enough that they wouldn't trip up in the near (or mid) term.  I liked your work and comments.  So I bought and own the bonds.  Guess that tells you which side i fall out on (yours). 
     
    Thank you for your good work on PVA.

  132. 132
    zman Says:

    Thanks, just trying to understand. 

    Offtopicthirty, grabbing lunch. 

  133. 133
    Sheentaa Says:

    BOP: thanks very helpful. I bought my first tranche in the 99-100 range and have been thinking of adding more at this sort of price. My CRZO bonds on the other have shown no sign of succumbing to the nat gas malaise, sadly. I'm looking to add some further HY E&P bonds, preferably from a company in the ZLT. Is there anything you think I should start digging into.

  134. 134
    BirdsofpreyRcool Says:

    Sheentaa — other than the PVA bonds right now, there are no "screaming buys!" in energy high yield bonds.  Unless you want to reach out and touch ATPG.  Which I don't.  But let me take a look around and see what else is out there.  At best, you're looking at an 8% yield. 
     
    Thanks for asking.  Always glad to try to help.

  135. 135
    Skeptcl Says:

    RE 125—Thanks Z. I've seen the same comments re BK & have pared back in the name, but it tempts nonetheless. Curious as to what Ross' plans are & how big of hit the redetermination will be. Had to put a sticky on my screen that says " No More Dry Gas"

  136. 136
    BirdsofpreyRcool Says:

    Just to illustrate:  pesky old KOG is rated in the basement at Caa1 / B-… but it's bonds are offered at a 7.00% yield to maturity (and a 6.75% yield to first call).  So it's kinda slim pickin's if your looking to lock in something that approaches the perception of traditional "HIGH yield." 

  137. 137
    BirdsofpreyRcool Says:

    ("you're"… i really hate it when i misspell contractions.)

  138. 138
    Skeptcl Says:

    RE 134–Saw some XCO 7 1/2's of '18 earlier today trading around 85 1/2—86 for a yield of 10.40% ish. Callable in '14 @ 103 3/4. Not sure if I'd bite though given XCO's upcoming earnings.

  139. 139
    BirdsofpreyRcool Says:

    OT:  If you can get to NYC on March 8th, I highly-encourage you to try to wangle an invitation to the Star Scientific investor day.  This is one sob-producingly volatile stock.  But someday it's gonna leave the station and not look back.  I don't think we are at that point yet… but could be there by the end of this summer.

  140. 140
    RMD Says:

    CHK saga: someone pointed out Fitch downgraded debt from positive to stable, rating BB yesterday. Said CHK has always been a 'slow pay', but rumor is HAL now wants cash in advance.  If true, may be related to new CHK service IPO becoming more of a competitor?

  141. 141
    BirdsofpreyRcool Says:

    Skeptcl — was just looking at those bonds…. offered at 84.5 right now.  Don't know enough about the outlook to opine.  And don't know management there either.  ;)

  142. 142
    Justin Says:

    OT: RSO
    BOP – heard any buy-side noise on RSO? 

  143. 143
    Skeptcl Says:

    BOP–agreed. I've been bloodied enough in the stock over the past 6 months.

  144. 144
    BirdsofpreyRcool Says:

    OT:  RSO.  Haven't heard a peep.  They announce earnings after close on Tuesday (May 1st).  But not expecting anything monumental, one way or the other.
     
    Of course, the definition of a "surprise" is that is shows up when you least expect it.  But at 14.9% yield, that's a heck of a yield…. and cushions some of the volatility of the stock.

  145. 145
    BirdsofpreyRcool Says:

    GEVO (which is not OT… just "green")… been trying to buy in here, but it's like trying to grab a rainbow… it just keeps slipping away (higher).  The company has said that they expect to finish their first commercial-scale plant changeover from ethanol to biobutanol by "the end of April."  They haven't backed down from that.  Also said they will ship a coupla trains of product by July.  They haven't backed down from that either.  Would 'spect hitting those milestones would be good for that stock.  That said, they intend to raise at least $75mm in equity at some point (sooner than later).  "Proof of concept" should grease the wheels of a 2ndary and allow it to be placed at a higher price than right-here, right-now.
     
    Just musing out loud… and watching it slip further away. 

  146. 146
    milepost_43 Says:

    121….PVA Bonds….CUSIP? Symbol?…thanks.

  147. 147
    elduque Says:

    Anybody see anything on GDP? Down 4.8%
     

  148. 148
    BirdsofpreyRcool Says:

    PVA bonds:  two flavors… take your pick
     
    7.25% due 4/19 and callable 4/15 (CUSIP  707882AC0) offered at $83.00
     
    10.375 due 6/16 and callable 6/13 (707882AB2) offered at $94.50.
     
    Those are institutional offers… you might have to pay a bit more.  But if it's more than 1/2 point, tell your bond desk where YOU see them quoted and tell 'em to go "work the order" for you at your level.

  149. 149
    Zorgnak Says:

    #52….sorry missed this one..things got a little hectic about that time..
    looking

  150. 150
    zman Says:

    re 147 – Don't see anything.  No filings, no brokerage comments I can see.   Don't see anything on the TMS play.   Looks technical to me, falling back to its 200 day SMA. 

  151. 151
    elduque Says:

    Thanks Z.

  152. 152
    zman Says:

    GMXR – setting up for a quick trade next week maybe, I'll wait for the news and then decide. 

  153. 153
    zman Says:

    RRC crossed over its 200 day SMA earlier, trying to hold those levels today. Saw Cannacord with a PT up grade from low to high $50s and a hold rating. This one will move on much of any improvement in gas prices and its oilier projects. 

  154. 154
    zman Says:

    Working on a Play cheat sheet, lots of slides from various operators, but like having them all in one place for quick reference and will just grow it over notes with small amounts of notes in between the slides. 

  155. 155
    Augusto Meoli Says:

    CRR  I gave it a try at $83.

  156. 156
    zman Says:

    TPLM just cresting its 50 day sma. 

  157. 157
    BirdsofpreyRcool Says:

    #154 — Great idea.  Is that something you could post?

  158. 158
    BirdsofpreyRcool Says:

    CXPO and PVA in a neck-n-neck race to the finish line today. 
    ZAZA not a contendah. 
     
    I looked at where ZAZA's Woodbine acreage is and I don't like it as well as CXPO's.  OTOH, ZAZA has some tasty holdings in the right place in the EFS. 

  159. 159
    Zorgnak Says:

    #52 BCEI
    To my  eye sellers dry up below 19.80  and early bulls are trapped above 21.43.
    The demand volume is positive at the moment  so a break of 21.43 is possible at any time, however
     we've just had a week long rally and it couldn't hold above 21.43 today.
    There is no strong consensus on value here yet , so it trades in constant discovery mode and not in sync with the group or market
    Two scenarios….
    Between 19.80-20 for adds on weakness.
    A break of 21.43 on volume after consolidation above 20.75. I don't see it getting away until above 21.85.
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_12.png

  160. 160
    zman Says:

    .Lot of volume clustered this afternoon in TPLM, someone of modest size is doing some nibbling. 

  161. 161
    zman Says:

    re 157 – yes, it will be a  permanent subscriber link at upper left, really basic to start with a few notes, saves time going back and forth between presentations 

  162. 162
    Dillon Says:

    #158 ZAZA
    What part of their EFS acreage do you like best if you don't mind me asking?

  163. 163
    BirdsofpreyRcool Says:

    $162 — the stuff that's in Zavata, Frio, Dimmit, LaSalle counties… right around MHR's acreage.  Being told it's good stuff.

  164. 164
    Zorgnak Says:

    #160….TPLM upper volume node today is nearly aligned with the volume nodes prior to the snap lower…interesting spot….
    http://www.charthub.com/images/2012/04/27/Stock_Weekly_1_13.png

  165. 165
    BirdsofpreyRcool Says:

    $162 — the stuff that's in Zavala, Frio, Dimmit, LaSalle counties… right around MHR's acreage.  Being told it's good stuff.

  166. 166
    zman Says:

    ROSE reports week after next, rebounding now, expecting another big quarter there, its condensate rich, not oily, but growth should be strong. We probably don't get anything really new from the SAB )Southern Alberta Basin) play but maybe a longer term rate on the strongest well to date. In the EFS look for new area (non Gates Ranch) well results to be strong (Briscoe Ranch maybe and quire probably in Karnes Trough area in Goznales county)  

    That TX Map of counties comes in very useful …

    http://www.google.com/imgres?imgurl=http://www.digital-topo-maps.com/county-map/texas-county-map.gif&imgrefurl=http://www.digital-topo-maps.com/county-map/texas.shtml&h=900&w=968&sz=93&tbnid=Opk7B5tLsuwpOM:&tbnh=90&tbnw=97&zoom=1&docid=Q16Tbd9jvyyxfM&hl=en&sa=X&ei=lPqaT4jcL6PI2gWu-NyDDw&sqi=2&ved=0CFYQ9QEwAg&dur=324

    …. because Gonzales / Lavaca are where MHR and PVA are drilling nice wells now. 

  167. 167
    zman Says:

    Beerthirty

  168. 168
    RB Says:

    thx everybody…had a great week; hope everyone has a great weekend!

  169. 169
    elduque Says:

    BOP – redundancy is a great thing. Thank you for all your help and everybody else.
     
    Enjoy the weekend. 

  170. 170
    BirdsofpreyRcool Says:

    elduque — redundancy is me thinking i caught (and corrected) a typo before posting.  Redundancy is me getting that wrong.
     
    Have a good one yourself.  And thanks!

  171. 171
    Dillon Says:

    Thanks BOP…I had heard their Fayette leasehold right next to where GeoResources' acreage is was better than expected as well so I was was just wondering if we had the same info.

  172. 172
    Popeye Says:

    Great week here also shampagnee 30.

  173. 173
    BirdsofpreyRcool Says:

    Thanks for sharing, Dillon.  Sounds like ZAZA has grabbed onto some prospective acreage.  This can have a outsized impact on such a little stock. 

  174. 174
    milepost_43 Says:

    148 BOP THANKS….

  175. 175
    zman Says:

    WHZ to announce results around May 10. 

  176. 176
    zman Says:

    The wrap is up

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