21
Apr

Wednesday Morning – Oil Preview + NBR and ECA

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Market Sentiment Watch: AAPL proved last night that the consumer is alive and kicking as well as listening to music and talking on over priced albeit sleek phones. All unit sales expectations were blown away. The market this morning is so far not taking its cue from that but is instead adopting a more cautious tone.  Today in energy land we have earnings from NBR and ECA. With the closing of the two HAL trades (and yes, I left some cash on the table there) the ZIM officially doubled yesterday and is back to 100% cash. 


In Today’s Post:

  1. Holdings Watch
  2. Commodity Watch
  3. Oil Inventory Preview
  4. Stuff We Care About Today – Earnings Watch: NBR, ECA, WIOWIO - "Why I Own, What I Own"
  5. Odds & Ends

Holdings Watch:

ZCAT (Zman Catalyst portfolio):

  • $11,500
  • 49% Cash
  • Positions for the quick view are updated on the ZCAT, ZIM, ZLT page.
  • Yesterday’s Trades:
    • Sold the May $15 BEXP Calls for $3.20, down 7% and uprisked into the ...

    • ... May $20 BEXP Calls for $0.45, added (30) bringing my total to (40). Expecting more well news here this week or next.

 

ZIM (Zman Inefficient Markets portfolio)

  • $20,500
  • 100% Cash
  • Positions are updated on the ZCAT, ZIM, ZLT page.
  • Yesterday’s Trades:
    • HAL – Sold the 20 $32 May Calls for $1.34 up 33%

    • HAL – Sold the 40 $33 May Calls for $0.85, up 26%.

Commodity Watch:

 

Crude oil rallied $0.72 to close at $83.85 yesterday on a strong market, end of contract volatility and a not so strong dollar.  After the close, the API released a bullish looking report (see below). This morning crude is trading flat.

Natural gas inched up $0.03 to close the day at $3.975 yesterday.  This morning gas is trading flat as well. 

  • Tropics Watch: Weather forecaster WSI ups hurricane season activity level. Now sees 16 names storms.  WSI said the water in the Atlantic is at record warm levels for April, "even warmer than the freakishly active season of 2005".

Early Read On Natural Gas Storage: Street is at 78 BCF for tomorrow’s report.

  • Last Week: 87 Bcf Injection
  • Last Year: 42 Bcf Injection
  • 5 Year Average: 41 Bcf Injection
  • 10 year Hi: 80 Bcf Injection
  • 10 year Low: 5 Bcf Withdrawal

 

Oil Inventory Preview


API Watch: 

  • Crude: DOWN 741,000 barrels
  • Gasoline: DOWN 1.743 mm barrels
  • Distillates: DOWN 3.103 mm barrels


Stuff We Care About Today

Why I Own, What I Own -Option Edition - the very brief bullets for the current ZCAT holdings.  If you've got more questions feel free to ask.

 

EOG - I own some May $115 calls for ...

  • Of the 6 remaining large cap domestic E&Ps, EOG went oily first and in the biggest way, so it is out in front of a trend that investors are now trying to get leverage to.
  • East Montana Bakken test - the Carat 2-33H well, could have results on the 1Q call (May 4). If the test is successful, EOG has a significant acreage position in the area that will further increase the potential oil reserves here.
  • Niobrara - 4 more horizontal wells they may be able to talk about on the 1Q call.
  • Valuation: Actually the name is cheap


BEXP - I own the shares and some May $20 calls for ...

  • Another well update as per the catalyst list
  • The possibility that EOG has a good well at Carat as BEXP is drilling a well near by and this could give the company a new core area in the Bakken, their Ghost Rider acreage in E. Montana, to go along with their Ross and Rough Rider areas, results from which have been driving the name.
  • Valuation is high but it's been that way for a long time.

HK - I own the shares and some May $24 calls for ...

  • Asset sales outstripped plan $1.4 B vs $1.0 B, well ahead of the mid year target
  • Shift to liquids rich drilling underway
    Growth in excess of 30%, likelihood of production beats vs guidance should be high
  • Capital discipline seems to be taking hold with management; capital budget for 2010 recently reduced
  • Management commented it has no need to go to the equity markets in 2010 and 2011.
  • Potential for another asset sale - rumored to be their Fayetteville assets.

WLL - I own the common and a May $75 call for ...

  • ... it's continuing status as the cheapest name amongst the Bakken players.
  • the position plays into the "oil over gas" preference play that continues in the E&P crowd.
  • New details on their new 200,000 acre Lewis & Clarke position (may or may not have one new well ready by the date of their 1Q call on April 29th)
  • Valuation: P/CF for 2010 of 4.9x and for 2011 of 4.0x is at the low end of the E&Ps and even low for this name despite the recent run.

NBR Reports Slightly Better Than Expected Numbers.

The 1Q Numbers:

  • Revenue of $902 mm vs $878 mm expected
  • EPS of $0.21 (ex items) vs $0.20 expected

Highlights:

  • North America - rigs up big in the U.S. as you'd have guessed, and up again since the end of the quarter.
  • "we do not believe the current [gas] price is sustainable over the longer term or even over the intermediate term"
  • seeing a flattening in shale gas drilling ... backs up comments made by HAL and WFT earlier in the week.
  • Mexico was soft due to funding constraints at PEMEX ... well known at this point in the quarter that Mexico was off, company further commenting that this deferral of activity continues.
  • International - they think was the trough quarter ... this also sounds similar to the other Service name calls this week.

Nutshell: I'll wait for the conference call here, more positive than not but -

Conference Call: Today, 11 am EST

ECA Reports Strong Quarter; Outlines Longer Term Growth

The 1Q Numbers:  (not a name I track closely but worth a listen)

  • Production of 3.26 Bcfepd (94% gas), in line with guidance.
    • up from 3.2 Bcfgpd a year ago and 2.8 Bcfepd in Q4 (which had some volumes curtailed due to low prices)
    • gas production was strong due to Piceance, E. Tx and Haynesville results.
  • CFPS of $1.57 vs $1.33 expected

Highlights:

  • Reiterated that it will meet prior production guidance for 2010.
  • Establish long term goal of doubling production per share over the next five years.
  • Continues to repurchase shares; bought 9.9 mm in Q1 or 1.3% of outstanding.
  • "believe the current gas price environment is unsustainably low".
  • Hedges:

    • 60% of expected 2010 production hedged at $6.01. Nice.
    • Just over 25% of 2011 and 2012 volumes hedged at $6.52 and $6.46 respectively
  • Debt to Cap of 30%; $5 Billion in untapped credit lines; $2 B in cash.

 

Nutshell: Good quarter and I think worthy of a listen following their recent split from their non-gas assets.

Conference Call: Today, 12 pm EST

Other Stuff:

  • We get earnings from NE, DO, ESV, and BTU tomorrow.
  • RIG rig explosion - Deepwater Horizon catches fire in Gulf of Mexico

Odds & Ends

Analyst Watch:

  • RIG cut to Neutral at Credit Suisse
  • CRU and TOO inititiated at Buy and Neutral at UBS
  • CRU initiated at Opco at Outperform, target $13

 

117 Responses to “Wednesday Morning – Oil Preview + NBR and ECA”

  1. 1
    VTZ Says:

    I vote for you to start following ECA… for my own benefit of course, but also because I think it’s a name you should be following in general for new play/rate ZCAT-style information.

  2. 2
    zman Says:

    V – agreed, makes more sense for me to now in their new form. That looked like a nice quarter, not sure on guidance on costs relative to actuals but bottom line worked out well. They’re drilling some nice wells in the Haynesville but there was not a lot of additional operational color in the pr.

  3. 3
    BirdsofpreyRcool Says:

    from the trading desk… cnbc reporting that the govt has testimony from a former Paulson & Co official that appears to contradict the gov’ts case that Goldman misled ACA… cnbc says Paulson official told ACA is was going to short the CDO.

  4. 4
    bill Says:

    ACA and paulson mutually picked the securities.

    Why waste the crisis without a witch hunt

    Also, as Im sure you know, the sec voted along party lines to push forward.

    It’s all political,imho

  5. 5
    Jerome Blank Says:

    ECA…nice looking chart, with a long formation triangle,on a P&F buy signal…stong support at the confluence point, 200 day SMA avg, and trendline…resistance at about $33.50…

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID3724280

  6. 6
    zman Says:

    Thanks JB for the quick turn there, will go vote for ya. I’m still looking at some of the numbers but the quarter was solid, the growth goal is solid, should be a good call although it’s not until 12 EST. ECA is not expensive trading 4.9x 2011 CFPS. From this I’d say estimate come up slightly for 2010, maybe just to account for the beat plus a little, probably not enough in the data to cause an upgrade of the out year. Still makes me think the stock could tread back up to at least the $34-35 range in the fairly near term.

  7. 7
    zman Says:

    Good charts, voted JB.

  8. 8
    zman Says:

    Analyst Watch: TPH with a Buy on DVN.

  9. 9
    Jerome Blank Says:

    RE: #7, Zman, thank you…

  10. 10
    BirdsofpreyRcool Says:

    Global Hunter out with a short comment on EXXI… cheap to cash flow and oily production. The acknowledge there was an equity-issuance rumor out there y’day that drove down the stock. They don’t think EXXI will do a 2ndary until the stock is $25+.

  11. 11
    tomdavis12 Says:

    JB: Do you know who votes for you? Or do you only see totals?

  12. 12
    BirdsofpreyRcool Says:

    looks like Greek Freak is back on the table. Headlines that stocks down in Europe as Greek Debt Swaps Jump to Record Levels.

    Bears need to keep panic level up… and need to keep SPX under 1200. If they can’t do that in the near term, they will retreat for a while. If they can, then it’s Bear Free Play for the next month or so.

  13. 13
    zman Says:

    re 10 – thanks BOP. May play today, overdone, market will get that it’s not MMR, it’s the new, improved EXXI.

    Any color from HT/TT

  14. 14
    zman Says:

    Planning a 3 stage entry on ECA this am.

  15. 15
    Jerome Blank Says:

    Re: #11 tom…just totals…

  16. 16
    dij Says:

    Stage three entry? Rockets, the unmentionable? Help.

  17. 17
    zman Says:

    Buy a little, wait, buy a little more, wait, buy a little more, wait, sell. Maybe a 2 day span to the sell since this is the ZIM.

    Speaking of rockets, saw a Fark headline the other day about Iran’s new missile. “Iran missile expected to be able to reach the U.S. by 2015 … man that’s one slow missile.”

  18. 18
    BirdsofpreyRcool Says:

    TechTrader is 60/40 SHORT today.

    HeadTrader is not on board with that call. He points out that earnings have been too good lately and once again he would buy pullbacks.

  19. 19
    zman Says:

    Analyst Watch: EOG

    Howard Weil ups target from $118 to $139. Kind of a delayed reaction to the analyst meeting a couple of weeks back but welcome.

  20. 20
    zman Says:

    ZTRADE – ZIM – ECA

    ECA – Added (15) ECA May $33 Calls for $0.70 on the mid with the stock at $32.45, likely to add more after or during the call and after the oil inventory report.

    ECA – Also added (10) ECA May $32 Calls for $1.15.

  21. 21
    dij Says:

    Got it, are you looking at the 33’s for ECA? Premium should be down after earnings.

  22. 22
    BossmanG Says:

    Z, online now.

    What I did is I navigated through my rss links to your site and it picked it up! (I was typing in manually your website link before).

  23. 23
    zman Says:

    re 21, see 20.

    BossmanG – it should resolve itself naturally over the course of the day. If you want to know where not to have your site hosted I have a suggestion.

  24. 24
    redjack Says:

    I’m having trouble with the site also.

  25. 25
    1520sbroad Says:

    Z – on your HK may $24s – saw big volume in that particular strike yesterday – over 4,000 contracts also big volume in Sept $23s. Interesting to see given all the big volume relatively flat days in the stock. I’d like to see some big volume up days follow onto this sideways action…

  26. 26
    zman Says:

    Good to see SSN not seeing another day of selling. I agree with Eli’s comment yesterday that it holding even close to this range is probably a positive sign. They will spud the next Bakken well mid to late May.

    WHX – through $21, still not looking back. This a quarterly paying royalty trust so probably no word on 1Q until mid May. I am seeing strong distributions from other monthly payers and positive reactions in their prices as well. My model puts the distribution based on the quarter’s prices, my wide looking differentials, average costs, and a conservative look at quarterly production decline puts the distribution at $0.61 this quarter. Based on their current price this puts them at about an 11% yield going forward (again, based on my model assumptions).

  27. 27
    Jerome Blank Says:

    KOG…posted a 30 min…testing resistance now …strong intraday support at $3.71, easy to manage if it breaks down with stops just below …but could go much higher from here if it breaks higher above the trendline..

  28. 28
    BirdsofpreyRcool Says:

    Still here… just lurking and thinking.

    Supposedly, Congress is going to launch their next push to pass Cap-and-Tax next week. I would think that would spike volatility in the energy sector. If we start to see “bipartisan agreement” on this, can’t see how that helps good old “dirty” energy… like E&Ps. Any thoughts?

  29. 29
    zman Says:

    BOP – I saw Kerry was working on C&T. I saw one of the compromises was to remove a tax on oil production in the U.S.

  30. 30
    jiveyjr Says:

    I bit on KOG 30 min chart…thx JB; voted

  31. 31
    jiveyjr Says:

    man WHX…glad I bot; didn’t like the boxed in structure much but that’s why we pay Z the big bucks to figger out whether that stuff matters or not…good call

  32. 32
    Jerome Blank Says:

    Re: #30, jivey, thanks for the vote…

  33. 33
    zman Says:

    ECA has given back all of the mornings gains, will probably add a second piece but not a big fan of that action on earnings day. Either way, will wait out the oil inventory numbers due in 5 minutes.

  34. 34
    zman Says:

    Thanks Jivey, not sure I get the big rally in the name other than it was over yielding to it’s peers and the market seems to be sorting that out.

  35. 35
    zman Says:

    EIA Oil Inventories:

    Crude at time of release: up 45 cents at $84.30.

    Inventories:
    Crude: up 1.9 mm barrels on a big rally in imports
    Gasoline: up 3.6 mm barrels
    Distillates: up 2.1 mm barrels

    Demand
    Gasoline: pretty good at 9.152 mm bpd
    Distillates: still soft at 3.466 mm bpd

  36. 36
    zman Says:

    Nothing bullish in this report.

  37. 37
    zman Says:

    I think oil bulls can forgive the headline build on crude inventories due to the rise in imports which is likely to dip back away from this level next week.

    But on the production side, throughput looks too high for current demand by a ways and that will put a lid on gasoline prices and probably crude as a result.

  38. 38
    Jerome Blank Says:

    #30 KOG…pushed below the intraday support level, on a day trade you’re probably out, but if your still with it KOG has 20 day SMA daily support at $3.60…

  39. 39
    zman Says:

    Big build in stocks at Cushing should also serve to cool crude prices for a bit. API report agreed on a big rally there, almost identical build of 1.8 mm barrels to 34.1 mm barrels which would be about a 3 month high which was just short of a decade high at Cushing.

  40. 40
    zman Says:

    Crude down only 50 cents which is a bit surprising. Equity market action likely to dictate crude direction for rest of week. Feels higher despite the data. One thing favoring that would be a retreat of margins that should occur at these elevated production levels. Refiners should be thinking, whoa, maybe we are jumping back in a bit too fast for the demand side.

  41. 41
    zman Says:

    NBR call in 15 minutes.

  42. 42
    choices Says:

    Some color on the Bakken field (FWIW):

    http://www.nytimes.com/2010/04/21/us/21ndakota.html?hpw

  43. 43
    jiveyjr Says:

    WRES breaking out…reading their recent transcript…they are getting a bit more promotional it sounds like…maybe they will get up a drink some coffee before their next earnings call, put out a release an hour before etc.

  44. 44
    zman Says:

    Jivey – heh, heh.

    NBR call starting now:

    http://web.servicebureau.net/conf/meta?i=1113167941&c=2343&m=was&u=/w_ccbn.xsl&date_ticker=NBR

  45. 45
    andy Says:

    z – i bot puts in XCO yesterday when i read the story thinking this might become a bigger deal. XCO was weak this morn , but now everythings weak. do u think XCO’S weakness is attributable to that story or just general mkt conditions??

  46. 46
    zman Says:

    NBR notes:

    Gas drilling in the shale should level off, maybe decline a bit, we don’t know.

    The oil shale drilling continues to rise, and is more important to us, continuing to set drilling records.

    Leading driller in the liquids rich shales in the U.S. now, including the Eagle Ford oil window.

  47. 47
    zman Says:

    Andy – probably a bit of both, it’s down more than the rest, chart looks weakish.

  48. 48
    zman Says:

    NG up five cents, oil off 80 cents.

  49. 49
    zman Says:

    NBR Notes:

    Algeria didn’t hurt them as much as others

    Iraq – expect it to be big but its not in their expected recovery thinking very much for 2011.

    Canada – still not great, sees their position rising due to British Columbia shales.

  50. 50
    Jerome Blank Says:

    WRES…updated and added a daily chart…next resistance at topside channel line at or about $3, corresponds with a P&F reversal back into X’s on the current buy signal, if bullish, a consolidation and shallow pullback off trendline resistance might be a place to consider long trys…

  51. 51
    zman Says:

    NBR Notes:

    Talking about higher prices down the road prompting a public offering in their oil and gas side. Also some other asset monetizations.

  52. 52
    andy Says:

    gmigdc- thks

  53. 53
    zman Says:

    NBR Notes Q&A session:

    Have not yet seen drilling back off in pure dry gas focused targets.

    NBR hopes margins are headed back to the low double digits and then back to the peak but that will take some time. Signing long term contracts in the Bakken, just signed a 5 year deal, seeing demand rise for term contracts in the EFS as well. This is for the higher end, 1,500 HP rigs. But the lower end rigs are moving up in rates as well.

  54. 54
    zman Says:

    re 52 – yep, yep, keep that kind of stuff coming.

  55. 55
    zman Says:

    S&P peeling lower.

  56. 56
    john11 Says:

    11:36 ET 4/21/10 XCO Exco Resources announces agreement to acquire Common Resources LLC jointly with BG Group (BG.LN) for $446M cash ($18.77 -$1.02)

  57. 57
    Alhambra Says:

    yikes:
    http://news.yahoo.com/nphotos/US-Coast-Guard-Deepwater-Horizon-Petty-Officer-2nd-Class/photo//100421/480/urn_publicid_ap_org41c4e4b594984b8db27fb583efcfbcf0//s:/ap/20100421/ap_on_bi_ge/us_louisiana_oil_rig_explosion

  58. 58
    john11 Says:

    DALLAS–(BUSINESS WIRE)–EXCO Resources, Inc. (NYSE:XCO – News) (“EXCO”) today announced an agreement to purchase Common Resources, L.L.C. (“Common”) jointly with BG Group plc (LSE: BG.L – News) (“BG Group”) for approximately $446 million in cash, subject to customary purchase price adjustments. Common owns producing assets, gathering lines and acreage in Shelby, San Augustine and Nacogdoches Counties, TX. Common’s Eagle Ford assets are not part of the acquisition. Before closing, Common will sell or otherwise distribute its Eagle Ford assets to a third party.

  59. 59
    zman Says:

    Re 57. Best thoughts to those involved.

  60. 60
    zman Says:

    NBR nutshell: pretty strong going forward, watching more closely. Still feels like best idea in the space is HAL/SLB.

  61. 61
    zman Says:

    ZTRADE – ZIM – ECA

    ECA – Added (15) ECA May $33 Calls for $0.45 on the mid with the stock at $31.50.

    ECA – Also added (10) ECA May $32 Calls for $0.80.

    Conference call about to begin.

  62. 62
    zman Says:

    ECA call about to start

  63. 63
    zman Says:

    ECA Notes:

    Haynesville – 23 rigs running, only drilling 1 well per location at a time to max leasehold grab. Moving towards a target of 35 days per well. Currently producing 250 MM/d net to ECA, on track to produce 400 to 500 MM/d by year end.

    ECA has contracted all services for 2010, mitigating inflation pressures.

    When they go to pad drilling I wonder if it will look like their 16 super pads in other regions. Lots of benefits to that model in terms of efficiencies/costs.

  64. 64
    zman Says:

    ECA call ongoing but they’ve moved on into reading the pr. ugh.

    Crude now green.

  65. 65
    zman Says:

    ECA sees spending another $300 mm on share buybacks in rest of year and sees divesting about $500 mm in assets.

    On track in terms of growth targets, 1Q production of 3.3 Bcfgepd is essentially on target with their average production target for the year and they see the exit rate capacity at 3.4 to 3.5 Bcfepd.

  66. 66
    TEXWS6 Says:

    I might know someone who’s in charge of pad drilling for a certain company…LOL!!

  67. 67
    zman Says:

    TEX – care to share, lol?

  68. 68
    zman Says:

    ECA – Horn River – right now at 20 mm/d, see 55 mm/d average this year, with a 2010 exit of 100 mm/d and 200 mm/d exit for 2011. Gas, gas, gas.

  69. 69
    zman Says:

    ECA – these guys are sandbagging on the official volume guidance. Volumes in 2Q should be higher than 1Q which was above plan as they brought back on more volumes than analysts expected. The only reason it doesn’t beat numbers would be a resumption of voluntary shut ins if gas prices fall further.

  70. 70
    zman Says:

    ECA – Maverick Basin (Eagle Ford Shale)

    were with TXCO, now partnered with NFX, just completed first well and are evaluating that. Best guess is we could have data there right before or on the NFX call.

  71. 71
    zman Says:

    Group greening nicely now.

    ECA – Question the guidance, wondering how it jives with all the growth they are talking about.

    1Q – brought back on a lot of shut in gas, so you had flush production, so the next quarter could fall off a bit, but with activity that could be a bit muted.

    Canada early break up is going to mean a dip there.

    Sounds like if they shut in some gas like last year, they will make their 3.3 Bcfepd target number for 2010 but if they don’t do that and everything else works as they expect then they are at the 3.5 Bcfepd level. So 3.3 Bcfepd sounds kind of like worst case which is price induced.

  72. 72
    Popeye Says:

    HK waking up.

  73. 73
    zman Says:

    Popeye, yeah, it’s a group based move, which is market based. Nice to see but not getting excited yet, really need to break that one out technically. Right now my options portfolios are fairly focused with only 5 names including the ECA from this morning. That group is all green after a pretty sharp red turn this morning.

    The portfolios are updated by the way but I did not update prices on the ZLT. WHX up another 3%.

  74. 74
    zman Says:

    Crude paying more attention to the equity market than the inventory numbers as expected, now up 40 cents as the S&P goes green.

  75. 75
    zman Says:

    EOG taking out 112, new 52 week high.

  76. 76
    zman Says:

    ECA Call over.

    Bottom line, not a lot of surprises, good comments about costs and cost inflation appears to be fairly tame for them. Good comments on production guidance, stock down 6 cents at end of call. Should see some numbers rise here but not by much, more likely a quarter by quarter progression on the part of the analysts as you don’t want to get ahead on volumes and then have the company cut volumes back due to low prices as they have said they might.

  77. 77
    choices Says:

    FWIW:

    http://www.marketwatch.com/story/paulson-co-turns-bullish-on-economy-housing-2010-04-21

    Kudlow also has been banging the drum for the past several days for a V-shaped recovery.

  78. 78
    zman Says:

    Does Kudlow have any other mode than gungho bull?

  79. 79
    zman Says:

    Tom – you in NE before the numbers?

  80. 80
    Jerome Blank Says:

    KOG 30 min chart updated….unfortunatly broke first support at $3.71 this morning on light vol, but held at the daily 20 period SMA at $3.60…resistance retest is back at $3.71…an intrady breakout would confirm if KOG can get above the 100 period SMA at $3.78 on the 30 min…

  81. 81
    zman Says:

    $20 mm or we blow up the tanker.

    http://news.yahoo.com/s/nm/20100421/wl_nm/us_somalia_piracy

  82. 82
    BossmanG Says:

    Hi All,

    Anyone have any experience with “LiveVol”
    http://www.livevolpro.com

    The pro service…

  83. 83
    tomdavis12 Says:

    Z: My position re NE has been the same for the last few months. Long common, covered and uncovered calls @ 50, Naked puts @ 40 & 36. Would buy with cost of 37 – 38. Would let go of some @ 50. Expect a slight beat tonight. Last 5 quarters they have averaged an 8% beat. Street is at $1.33/sh

  84. 84
    zman Says:

    MCF hanging tough just under $60.

  85. 85
    zman Says:

    Thanks Tom – I won’t review it tonight as I’m not as close to the name as you.

  86. 86
    tomdavis12 Says:

    Z: I’ll share my thoughts after the CC, but this is NOT a Z stock. Not truly a growth vehicle. A cyclical cash flow vehicle. I am happy with 10% to 20%/yr out of these assets. That is not how you roll. With the new account we see it even more all the time.

  87. 87
    zman Says:

    Tom – you mean like the ZLT and the WHX position? I have money in distinctly different strategies. As I guess I don’t say often enough, options are the small piece of the overall investment pie.

  88. 88
    zman Says:

    JB – where do you have resistance on WHX?

  89. 89
    tomdavis12 Says:

    Z: Maybe I unfairly give you only credit for what you do best (wash & rinse). It comes from the fact that you are truly unbelievably good at what you do. I know of no one better at listening to the CC’s and making money from that info. You have my complete respect.

  90. 90
    tomdavis12 Says:

    Z: You also get a gold star for LINE & VNR weather you played them properly or not you did point out the value.

  91. 91
    Jerome Blank Says:

    #88…WHX…not much historical data to work with…dialing out even to the weekly the best we can say right now with the current technical strength is that the P&F price objective on the current buy signal is $32…if WHX consolidates I think we could then get a better handle on meaninful resistance…

  92. 92
    VTZ Says:

    Offtopic – Is anyone else looking at POT and thinking this is an attractive low risk setup.

  93. 93
    zman Says:

    Now you’re just making me blush. But thanks. Please write something up for NE.

    I still hold LINE for about a double, VNR I never bought.

    JB – thanks much.

    VTZ – not sure how low risk it is unless you go with a crowd, see link
    http://www.aolnews.com/weird-news/article/for-pot-smokers-420-day-is-high-time-to-celebrate/19447403

  94. 94
    VTZ Says:

    Well hopefully I get a crowd joining my trade.

    Also, if gold closes above 1145 then it can consolidate then make a move to the last resistance before testing the all-time high.

  95. 95
    zman Says:

    Asked on the backup site re my thoughts for continuing to hold the ECA calls. My response:

    Definitely through today, not adding any more for the moment. Will like to see some post call reaction, so far nothing.

  96. 96
    1520sbroad Says:

    #92 – I follow POT very closely – I like it down near $100. I do think earnings on 4/29 will be interesting and have the potential to surprise some folks on the upside. The goldman downgrade of them last week could be a little prmeature in my mind.

  97. 97
    zman Says:

    Grabbing a late lunch.

  98. 98
    VTZ Says:

    Thanks 1520s RE POT – 100 on the TSX chart and 100 on the NYSE chart look very different on both charts due to the currency exchange. On the CAD chart 110 matches with strong levels of past support and resistance. On the US chart 110 is at support of an uptrend line.

    I used to follow it a lot closer until I took an AGU position instead but I’m going to try my luck with it here.

  99. 99
    1520sbroad Says:

    #98 – i hear you – i have been watching a point and figure chart on POT for a long time and we are right at an uptrend line right now – $106-109ish USD. There is good support for it around $100. I have a long term position in them that I have added to around $100 in the past. Since about November of last year POT has spent a lot of time between 100 and 120.

  100. 100
    tomdavis12 Says:

    Z: Just to go on record re NE. I am looking for 1.40 earnings on 860M rev. CD cost up 30M and rev down 50M from 4th q numbers. Gross margins down 5%. The downgrade today on RIG was mostly a pricing issue. We will see how NE responds to that. Stay tuned.

  101. 101
    zman Says:

    Tom – thanks. I don’t recall how much they give in the way of forward guidance, any thoughts on that?

    Group trudging sideways, all eyes on market which is on the housing numbers for the next two days.

  102. 102
    tomdavis12 Says:

    Z: NE does not give forward number guidance but does spoon feed sell side models with one on one contact.

  103. 103
    RMD Says:

    I’m filling in a spreadsheet and trying to break out valuations for proven developed/ mcfe vs a proved undeveloped mcfe?
    These are boring Permian gassy production.

  104. 104
    tomdavis12 Says:

    Z: Indirectly spoke with a mutual fund manager who owns much HK. At the end of year he owned 210M worth and was his second largest position. At 3/30/10 he owns 139M worth and is his 10th largest position. His reason for cut back was the poor performance of NG with the cold winter. Going forward he thinks you make lots of money when you are long companies that continue to grind out numbers and then they get to the light at the end of the tunnel (higher NG prices) and you get big short term performance and that is why he is committed to stay with the name. His ten year performance is +14.5%/yr with big ups and downs.

  105. 105
    elijahwc Says:

    This ought to be a winner:

    STR Questar Considering Spin-Off of Exploration & Production Business (45.86 +0.01)

  106. 106
    jat Says:

    RMB, do you have Bloom? If so there are relatively simple field-based ways to download that information.

  107. 107
    elijahwc Says:

    Calling Aubrey or anyone in the Bakken…..please take out call:

    C.K. Cooper & Co.: TRGL – UPDATING ESTIMATES – BUY – $12.50

    We have updated our estimates for TRGL to reflect the increase in our benchmark oil price deck from $70/Bbl to $80/Bbl.

    •••• Consequently, EPS/CFPS changed from $0.00/$0.23 to $0.05/$0.29 in 2010 and from ($0.01)/$0.20 to $0.06/$0.29 in
    2011. NAV/Share increased from $9.48 to $12.65.

    •••• We maintain our BUY rating and raise our price target for TRGL shares from $9.50 to $12.50 to reflect our higher oil price deck. TRGL has exploration licenses covering ~800,000 acres of the Paris Basin Shale oil, which is believed to contain 30 Billion Bbl of oil in place in a geologic setting that is similar to the oil rich Bakken formation of North Dakota. By utilizing recent advances in horizontal drilling and multi-stage fraccing technology that have worked so successfully in the Bakken,TRGL hopes to unlock the immense oil potential on its acreage in the Paris Basin shale. The company’s near-term goal is to sign an agreement with an industry partner that can provide capital and technical expertise to test the shale oil deposit. In March, management indicated that the interest level among potential partners was high and that it would likely have an
    agreement signed by mid 2010

  108. 108
    elijahwc Says:

    “please take our call” above

  109. 109
    RMD Says:

    jat 106 nope, don’t have Bloomie. The question is : I’m comparing and E&P co’s valuation/mcfe to the MLPs. MLPs well at roughly $4.75/m with 90%+ being PDP. I figure I can value the PDP (which is 43% at the E&P co.) at $3-4.00 , but don’t know the $/m to assign to the remaining 57% of proved reserves.
    Please give a guess; all are welcome. (No T-shirts though since there is not a correct answer…actually I have lots of old t-shirts.)

  110. 110
    john11 Says:

    Susquehanna out with some very nice targets, particularly the second one on the list…

    Susquehanna initiates BRY, CHK, EOG, others

    EOG Resources (EOG) initiated positive with $126 target
    Energy XXI (EXXI) initiated positive with $38 target
    Forest Oil (FST) initiated positive with $34 target
    McMoRan Exploration (MMR) initiated positive with $19 target
    Plains Exploration (PXP) initiated positive with $41 target
    SandRidge Energy (SD) initiated positive with $11 target
    Whiting Petroleum (WLL) initiated positive with $101 target
    Berry Petroleum (BRY) initiated neutral
    Chesapeake Energy (CHK) initiated neutral
    Pioneer Natural (PXD) initiated neutral

  111. 111
    BirdsofpreyRcool Says:

    john11 — thank you for posting. I feel less like a Crazy Old Bird now.

  112. 112
    BirdsofpreyRcool Says:

    oops… temporary lapse in brain wave activity. Susquehanna now has one of my very favorite energy analysts, Duane Grubert!! Does anyone get their reports?

  113. 113
    BirdsofpreyRcool Says:

    BedTime Market Strategist

    Visiting Hours.

    Equity markets bounced around today as investors remained pensive about embracing the rebound of the past couple of sessions. Investors are cautious to pay up and establish new high prices knowing the Administration has taken the gloves of in waging the financial reform battle. The Administration’s standard approach is to knock you down three or four times, so that when they finally offer you a hand to get up, you find yourself saying thank you. The result was the selloff in the S&P 500 today in the half hour leading up to the President’s television interview today. Tomorrow is the President’s big visit to Wall Street to discuss Financial Regulatory reform.

    It will be interesting to see the environment and how the speech is received. Today, the NY State Comptroller Thomas Dinapoli put out a press release titled, “DiNapoli: State Could Run Short of Cash, Releases Final Closing Numbers for Last State Fiscal Year, Warns of Cash Crunch.” The only reason the state finished the 2009-2010 fiscal year with a positive balance was it postponed payments into the new fiscal year. The release notes “The state Division of the Budget projects the General Fund will end the months of May, June, July and August with a negative balance. This is unprecedented in New York’s history, indicating growing fiscal stress and historically low cash flow levels.” The Comptroller’s annual data was the primary spark for the Wall Street bonus outrage over the past 18 months. Politicians throughout the country, including many high profile ones in New York, used the data to take a populist approach and bash Wall Street for political gain.

    New York City is hardly an enclave of conservatism, but in recent weeks and months, the tone of the main stream print media has shifted in favor of Wall Street (or at least the taxes it pays) and in opposition to Washington. The charge has been led by Mayor Bloomberg who recognizes the importance of the Financial industry’s tax revenues to the livelihood of the city and the state. Local media has also turned on Senator Schumer who is being portrayed as trading Wall Street (and thus New York) in favor of landing Harry Reid’s post as Majority Leader if (when) Reid is voted out of office in November. Currently, the state could not have a weaker Governor, and his likely successor has been among the most aggressive Wall Street bashers, leaving Bloomberg as the only high profile politician in the industry’s corner. Now, the President heads to New York to spread his message the day after the state comptroller warns of the state’s precarious financial state due to reduced tax revenues. With an election approximately 6 months away, today’s news should be a wake-up call to all New York politicians to follow Bloomberg’s lead. If they don’t start to battle for their continuants, then soon they won’t have any.

  114. 114
    skimo Says:

    Don’t NY politicians want to battle for their constituents vs their continuants or is that a play on words that this poor unsophisticated small town boy is to simple to understand?

  115. 115
    BirdsofpreyRcool Says:

    BedTime Market Strategist gets a little sleepy near the end, it seems. ‘Nite!

  116. 116
    PackMan Says:

    Well Mayor Bloomberg, the majority owner of Bloomberg, might have just a teeny weeny slight personal conflict in favoring Wall Street. Funny how media reports just can’t seem to connect those dots.

    After all they are his customers and responsible for his vast fortune.

    Just sayin ….

  117. 117
    bill Says:

    >Well Mayor Bloomberg, the majority owner of Bloomberg, might have just a teeny weeny slight personal conflict in favoring Wall Street.

    No more than the New york Times.

    I dont follow your logic

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