04
May

Wrap – Week Ended 05/03/13

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The ZLT trading blotter is updated. 

The ZLT C portfolio is update on the ZEB Positions tab

We'll have the earnings caledar for Energy Earnings Week 4 out this weekend on the Calendar tab at left

We'll have wrap comments on the earnings reports from last week along with oil and gas commentary in The Week That Was Section in the Monday post.

Contest in the Monday Post.

Holdings Watch: ZMT closed trades. 

  • 4/29 - HAL – Sold the remaining (15) $41 May Calls at $1.12, up 384%. Will revisit the name after a little post quarter profit taking takes place
  • Our VLO $43 (pre CST spin out May 4 expiring calls) expired worthless.   We continue to own VLO $42's that expire in 2 weeks  (formula to compare your strike to is 1 x VLO share + 0.1 x CST share.  

ZLT Trades - see the blotter ... but briefly,  we  added to our HK position. at $5.41 on the over reaction to their guidance during the 1Q13 call. 

Have a good weekend. 

wrap 050313

37 Responses to “Wrap – Week Ended 05/03/13”

  1. 1
    zman Says:

    From Pack Last Night:

    #122 

    Don't know if anyone saw this:  FCX, MMR deal – if approved – to close on June 3 – spinoff will be called Gulf Coast Ultra Deep Royalty Trust 

    http://www.4-traders.com/FREEPORT-MCMORAN-COPPER-12574/news/Freeport-McMoRan-Copper-Gold-Inc-FCX-and-MMR-Announce-Special-Meeting-Date-16810344/

     

  2. 2
    zman Says:

    re 122 – thanks for that … MMR has been doing exactly what we expected, drifting up into deal closure. At this point, knowing what little new that we do know regarding the UD, the new RT has very much discounted a lot of good news. It may jump day one and we may play on the irrational exuberance of that jump but for now we are in EXXI having left MMR in the lower $16s a couple of months back. 

  3. 3
    zman Says:

    Thanks for the retweets on these posts guys.

  4. 4
    Zorgnak Says:

    APC  Support at 85. Strong demand volume.

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040743.png

    COG  Trading sideways above support at 63.25 Large traders selling since 4/25.

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040748.png

    EXXI Basing with  large trader support since 4/22.

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040758.png

  5. 5
    Zorgnak Says:

    FTI Expect retest of break out levels at 54.56

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040801.png

    HAL  Expect breakout attempt to pull  back to 42 min with 40 as major acceptance.

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040805.png

  6. 6
    Zorgnak Says:

    HFC Through resistance. Looking for a test of 52 and above.

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040807.png

    VLO Resistance with considerable supply above at 38.51

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040810.png

    TSO At resistance after the pop. Don’t see the demand volume to move higher at the moment.

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040812.png

  7. 7
    zman Says:

    Thanks Zorg

  8. 8
    zman Says:

    On the VLO it's probably not apples to oranges given the CST spin out. 

  9. 9
    Zorgnak Says:

    #8 True…thanks

  10. 10
    Zorgnak Says:

    XLE  OB At resistance, breakout level. Demand volume strong. Support way down at 78.32. Tough spot but longer term the sector looks as good as I can remember. 

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040832.png

    OIH OB At resistance and top of long term volume base/congestion. Like to see it find balance around 42.87 area for another upside try. Longer term still looks good.

    http://www.charthub.com/images/2013/05/04/Stock_Master390_1305040844.png

  11. 11
    brodway Says:

    Wanted to pass this along for thought. Several hedge funds starting to take larger positions in energy names. May be in preparation of summer driving season and higher energy prices. SM, OAS, CRZO some of the names that were recently mentioned. I'm sure others can add other names

  12. 12
    501xx Says:

    AP story on history of fracking. EOG gets the kudos in this piece. http://finance.yahoo.com/news/technology-propels-old-energy-boom-142436703.html

  13. 13
    zman Says:

    Thanks re 10-12

    Short author on HK on Seeking Alpha who in a piece on Thrusday said HK was trading at > 10x EV/EBITDA

    Me: What's your model show for EBITDA for 2013 HK?

    Author:   "I haven't modeled it but looks like consensus is ~$500-600 mm."

    Me: "OK thanks. That's an incorrect consensus range you have for HK."

    I don't get people who talk about valuation but don't have models and have such a cavalier attitude towards what they think they know. 

    Street Consensus as of mid last week was sitting at $804 mm for 2013 … if you had any sort of even back of the envelope model you'd know that $500 to $600 mm was not in the realm of any reality. Be careful where you get your A) intrepretation of news and B) "analysis"  

    Back a bit later. 

  14. 14
    brodway Says:

    ORB wins the Kentucky Derby.

    I had the horse with the 3rd and 4th place finishers in an exotic bet, but didn't get the big cigar.

    Shug finally gets his first Derby win. 

  15. 15
    brodway Says:

    re: 13

    relying on other false information to model your story is like the blind leading the blind.

  16. 16
    zman Says:

    re 14 – congrats on that!

    re 15 – or like the deliberately clueless manipulating the faithful. 

  17. 17
    crysball Says:

    Look  what's  drving our  ecomomy………..from  Critical  Risk….the Senior  VP  of  the  Association of  American Railroads  states:

    "U.S. rail carloads of petroleum and petroleum products were up 46.4% (17,524 carloads) in April 2013 over April 2012. …

    Carloads of crushed stone, gravel, and sand were up 11.5% (8,959 carloads) in April 2013 over April 2012. Industrial sand is part of this category, and frac sand is a type of industrial sand."

     

  18. 18
    crysball Says:

    Z  rer  WHZ

    Would  appreciate  your  take   on  their  10-K  data:

    Volumes  of  NG  and  oil  seem   down  beyond  what decline  curves  should  indicate ?

  19. 19
    milepost_43 Says:

    VLO…interesting factoid from CC…

    Valero Energy Corp. will have the capability to unload 30,000 to 50,000 barrels of oil a day by rail at its Quebec City refinery by this July, company officials announced during their latest annual meeting in San Antonio. Valero has an export license to send up to 90,000 barrels of Eagle Ford crude a day to Quebec, the Montreal Gazette reports. Once the reversal of a pipeline is completed, Valero will be able to tap into it to get the crude to its Canadian facility.“When all that’s done, the Quebec refinery will be a North American sourced refinery, where today we are running Saharan, CPC, North Sea and West African,” says Bill Klesse, Valero CEO.

  20. 20
    mimster90 Says:

    re13 zman most people/non-pro investors don't know the power of modeling, I know I didn't until I had been following you for a year or so. This is after I used to do business process modeling, so I should have known. It would be a very interesting article on Why to model and to show the power of modeling and the dangers of non-modeling when investing your dollars. Maybe even a short paragraph in some of your SA articles that you publish about Why to model. It might raise the bar for others but then agian it might not. Just sharing a Sunday morning thought. Thanks for all you do here.

  21. 21
    zman Says:

    re 17 – pretty amazing that a little over a year ago we were concerned with the timing of new pipeline adds with regard to the Willistion as production would bump and pipelines would stair step up … and then rail blew those slides in the back of all the Bakken players out of the water in terms of importance. Now you have E&Ps and refiners who have terminals and cars and they keep adding cars and as a consequnece you have the differential to WTI collapse and you now have some guys reporting their best % of WTI revenue figures ever. Nice. Re sand, yep and you have more running sand in deeper applications. 

    re 18 – no problem, will addressin Monday post. 

    re 19 – yeah, with the cost of tranpsortation it makes sense, all you have to do is make sure you bring the product back to the U.S. since you sourced U.S. produced crude and then exported it, which is what they've have been doing. 

    re 20 – you're welcome.  I've been asking the vaious shorts what their models show for the companies they pontificate on. Either a long silence and then an answer about what they think it might be according to the Street … or no response. 

  22. 22
    milepost_43 Says:

    21 – 19….how does this movement affect import/export reporting for crude and products? thanks.

  23. 23
    zman Says:

    re 22 – have to step out for a couple of hours but briefly, I think it's a straight up calculation, and just adds to imported products. The big exports numbers go to the south and the east (Latin America and Europe).   What rail does do for them is get around using expensive Jones act ships. 

  24. 24
    tomdavis12 Says:

    LINE another knock piece from your tweet buddy this weekend. Brodway good call on ORB. Zorg – Thanks for your weekend work.

  25. 25
    crysball Says:

    The Economic  Bounty of  Shale Oil & Gas  in the USA

    Know  I'm  'singing to the choir'  but  it  is  still  a worthwhile  read:

    http://www.rbnenergy.com/we-should-be-heroes-the-economic-bounty-of-shale

  26. 26
    zman Says:

    The calendar for next week's reporting names has been added to the calendar tab at upper left on the site or here:

    http://zmansenergybrain.com/subscriber-data/calendar/

  27. 27
    nrgyman Says:

    RE 19, 21:  Help me out on this one.  If I understand this correctly, US law prohibits exporting domestic sourced crude, unless it is to a foreign refinery that produces products that are re-imported to the US in amounts (volume or $$ ??) such that the net trade balance is zero for the domestic crude exports.  At the same time, US law allows foreign crude to be imported to US refineries and for the finished product to be exported to any foreign buyer with no restrictions.  At the same time, US law allows for unrestricted exports of domesticly sourced NGLs but restricts exports of domesticly sourced LNG/CNG, even though unrestricted imports of LNG/CNG is allowed.  Is that the situation with oil and gas that the wisdom of DC has created?  

  28. 28
    zman Says:

    27 – mostly yep on that one. Some Alaskan crude can be exported, some crude can be sent to U.S. territories, and CA can send some crude to some Pac Rim counties. And some can be sent to Canada but their are restrictions on that. I think its all volumetric on the Canadian stuff but not really sure.  I'd add that there's also quite a bit of finished product that comes into the states as well. On the export of products, there are probably some export restrictions based on what types of product are to be exported but I can't tell that those have held back volumes going out of the States, especially for distillates as we are running near record levels and if you listen to all the refiners they continue to talk about ramping their ability to send more out. On the NGLs, don't know if there is a restriction in the amount but propane and ethane are big export items, don't see that they are restricted. But otherwise, yeah, you go it.  

  29. 29
    zman Says:

    Heading out for some sun, thanks for the questions, good to talk with you guys on the weekends too. Back in a bit. 

  30. 30
    nrgyman Says:

    RE 28:  Thanks Z.  Enjoy the sun.

  31. 31
    Zorgnak Says:

    Crude Oil Futs….The reactive buying off the latest freak out sell off down to the sub 90 levels saw the strongest push by by larger traders since last June. 8 of the last 12 days have been dominated by large buyers running prices to resistance at 96. Major long term acceptance is at 93.

    http://www.charthub.com/images/2013/05/05/Crude_Oil_Multi_Period_1305051344.png

    "The proportion of investment managers 
    underweight on commodities outnumbered those 
    overweight by 18 points, the highest level since 
    January 2009, according to a  BofA Merrill Lynch Manager's Survey" 

  32. 32
    zman Says:

    re 31 – very good, love that, thanks. 

  33. 33
    zman Says:

    re 25 – have not had a chance to read yet but will, thanks. 

  34. 34
    zman Says:

    Israel action again Syria has oil up a buck on Brent and a buck plus on WTI early this evening. 

  35. 35
    elduque Says:

    Zorg- take a look at /HG. It looks like a double bottom and breaking out over the shoulder. Could count to 3.60. Which should be constructive for FCX. 

  36. 36
    elduque Says:

    PWE- new chairman of the board and vice chairman. 

  37. 37
    Zorgnak Says:

    #35..re Copper.FCX.  I'd want to see buyers at a 30.50 retest on FCX. . Since the 4/17 demand has turned the corner though on FCX and is trying to turn the corner on copper of which I know even less about trading than Natural Gas and that's saying something.

    http://www.charthub.com/images/2013/05/05/Stock_Master390_1305051921.png

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