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  • Shale Oil Stocks - Time To Reassess [View article]
    Thank you all for your comments.

    Long-term I remain positive of the shale sector and it should offer shareholders good long-term returns notwithstanding some volatility along the way.

    However, for me the short-term risk-reward is noticeably unfavorable going into summer and, as stated in the article, I plan to reinvest in shale oil again if/after we get a general market pull-back and when individual stock valuations offer more upside potential. When the time comes, I intend to submit an article to Seeking Alpha outlining some of the more interesting new purchases.

    Wishing continued success to one and all.

    Thank you.
    Apr 29, 2014. 02:26 AM | 1 Like Like |Link to Comment
  • Strategy In The Face Of Volatility [View article]
    April 10th, changing a 2014 game plan published on January 7th. Classic. And more to come no doubt.
    Apr 11, 2014. 01:42 AM | Likes Like |Link to Comment
  • The Market's Annual Seasonality Is A Real Concern This Year [View article]
    "This year the Fed is tapering back stimulus, and will have it back down to $35 billion in May."

    I don't think this $35bn in May statement is quite correct. Assuming the Fed continue to taper by $10 billion at each meeting, the net amount of QE each month becomes; Dec'13 $75bn, Jan'14 $65bn, Mar'14 $55bn, Apr'14 $45bn, Jun'14 $35bn, Jul'14 $25bn, Sep'14 $15bn and the general thinking is that the final $15bn will be wiped out in the October meeting. Refer to confirmation yesterday by Dallas Fed member Richard Fisher.

    There are no Fed meetings in Feb, May, Aug and Nov and the $10bn reduction doesn't occur without a Fed meeting.

    That aside, 2014 does indeed look scary. I believe the best way to play this year is to stay in cash, buy dips and sell again on moderate upticks until the fall when one buys for a good year-end rally.

    Thanks for your articles, they are very well appreciated.
    Apr 5, 2014. 08:42 AM | 7 Likes Like |Link to Comment
  • 4 Reasons You Should Buy 3D Systems On The Pullback [View article]
    it trades on a... "forward P/E ratio of just 48". Wow.

    With a sky-high forward p/e of 48, the risk is still very much to the downside, especially with serious competition coming into the market and considering that the overall stock market is likely to experience a sizable pull-back this year as we get nearer to the end of taper. Let's remember what happened to the markets when the previous QE programs came to an end. Will it be different this time? I very much doubt it.
    Mar 27, 2014. 05:18 AM | 2 Likes Like |Link to Comment
  • Why A Stock Market Crash Is Imminent [View article]
    Crimea is a non-issue.

    The people have spoken, they've voted almost 100% to join Russia. We in the West cannot defy the will of the people and we don't have a leg to stand on with regard to punishing Russia. Yeah, Western leaders will huff and puff but ultimately there's nothing they can do.

    Nothing to see here, move along.
    Mar 17, 2014. 07:21 AM | 15 Likes Like |Link to Comment
  • Can U.S. Markets Avoid A Serious Correction Again? [View article]
    Spot on report, well said, and thanks for sharing.
    Mar 15, 2014. 11:09 AM | Likes Like |Link to Comment
  • Bakken Update: Frac Sand Pricing Could Go Parabolic In Q3 2014 [View article]
    Very good work Michael, insightful, thorough and valuable. Thanks for sharing.

    Clearly you were spot on with your call to enter the sand box in August and hopefully you were suitably rewarded by the market.

    Given current high valuations, your suggestion to look for a pull-back before buying again sounds wise. The Williston basin faces the risk of floods caused by melting snows and, if roads become impassable, this will surely cause well completion problems and stock price wobbles in the next month or two.

    Even ignoring short-term risks such as flooding, I consider the entire shale sector to be reasonably fully valued and I personally have cashed-out with the plan to await a pull-back, possibly in summer, before re-entering the market. We've all seen the movie.

    I'd guess it's now fairly widely understood that multiple perf clusters provide better fracture close to the well bore and by applying a lot more sand the end result is that a significantly greater amount of oil is extracted. Therefore, I'd assume that drillers who have not yet adopted "multiple perf" are rushing to do so because of the increasingly compelling advantages. Accordingly, with the sand companies and multiple perfers such as EOG and WLL all trading on fairly full valuations - like 2015 p/es of ~15 or more - I cannot help but think that another way to play this game would be to go after some of the better laggards that own a lot of good acreage such as OAS who are trading on forward p/es of 11-12. From all your very thorough work have you come across evidence that companies like OAS (and others in the Bakken or elsewhere) are moving to adopt 'multiple perf'? If so, then these relative laggards may enjoy a very nice catch-up during the next year or two.

    Thanks again for sharing, it is much appreciated.
    Mar 6, 2014. 03:31 AM | 1 Like Like |Link to Comment
  • Kodiak's CEO Discusses Q4 2013 Results - Earnings Call Transcript [View article]
    Periodically in the past KOG stock ran ahead of itself because of a perceived buyout possibility. Right now the stock is trading at 10.8 times 2015 earnings and it is a excellent value play. Buy.
    Feb 28, 2014. 05:08 PM | 2 Likes Like |Link to Comment
  • Bullard moves to hawk camp [View news story]
    "Sceptical of the recovery and firmly in the dove camp not long ago".

    He never really came across as a dove but rather a pseudo dove and today he's proving it. No surprises, nothing to see here, move along.
    Feb 19, 2014. 12:56 PM | 1 Like Like |Link to Comment
  • The Marie Antoinette Rule [View article]
    Poor auld Marie Antoinette get's a bad rap. She never did say 'let them eat cake' but the phrase was attributed to her by the revolutionary spin-doctors.

    Plus ca change je suppose.
    Feb 12, 2014. 03:21 AM | 8 Likes Like |Link to Comment
  • 2 Energy Concerns Around 40% Below Analyst Price Targets [View article]
    No doubt you are correct about NFX and EOX being good prospects. However, I would add that the pull-back has created value across the entire shale oil sector.
    Currently you can buy Whiting (WLL), one of the very top companies in the sector, at $55 which is also a 40% discount to analysts target price of $77. With it's cement-liner array-fracking technology already delivering IRRs of over 100%, together with its multi-year inventory of drill locations, WLL stock should outperform the peer group for the next couple of years. Besides, WLL has an established history of beating estimates by a wide margin and this trend shouldn't change in 2014.

    Recently published analyst targets for WLL were in the range of $85 to $95 - that's a great target range from the current $55 price.

    Pull-backs like the current one are great opportunities to pick up the best companies, go for them.
    Feb 5, 2014. 12:54 PM | 1 Like Like |Link to Comment
  • Bakken Update's 2014 Stock Picks: The Permian Operators [View article]
    Michael, do you have any reasonably accurate Boed production figure for the assets sold? I may have missed it but after scratching around I couldn't find confirmation from the company or in the 10Q.

    BTW, thanks for explaining the 2-stream 3-stream stuff although I have to admit I'm still not 100% clear about every aspect of it.
    Jan 31, 2014. 06:37 AM | Likes Like |Link to Comment
  • Bakken Update's 2014 Stock Picks: The Permian Operators [View article]
    Spot on Michael.

    LPI stock is attractive although, wearing my own value hat, I like FANG even more.

    Fwiw, I bought Friday/today and figure that the current market pull-back will blow itself out within the next day or two:
    - the Chinese problems should be resolved this week;
    - the FOMC unknowns will also be resolved in a couple of days time and;
    - given the readiness of the various global central banks to press the liquidity buttons, I don't think the Argentina or Turkey currency issues are truly material.

    Hence, given the sharp pull-back in stock prices this past 3 months of FANG, LPI and other top quality names such as WLL and PDCE, we are now witnessing stock prices that will prove to be very attractive as 2014 unfolds.

    Buy them all.
    Jan 27, 2014. 01:19 PM | 1 Like Like |Link to Comment
  • Bonanza Creek Another Interesting Second-Chance Story [View article]
    Agreed on all counts, good work.

    BCEI at around $43 and PDCE under $50 are attractive and both should be comfortably higher within a couple of months. Amongst other, investors will be reassured by EPS estimates for 2015 which will indicate continued strong growth. These 2015 estimates will be made known in about 5 weeks time. For example BCEI's 2015 EPS estimates are likely to be in the $4.00 to $4.50 range, putting the shares on a potential forward p/e of only 10 based on the current stock price. That's cheap. Not long to wait.
    Jan 17, 2014. 11:03 AM | 4 Likes Like |Link to Comment
  • RSP Permian IPO: Projected Long-Term Growth, Promising Public Offering [View article]
    "If RSPP hits the midpoint of its price range it will have a market cap of $1.5bn."

    RSPP has net 33,000 acres in the Permian with multiple oil bearing zones.

    FANG has 66,000 net acres in the Permian also with multiple oil bearing zones.

    Production for both companies is about 85% liquids and 15% nat gas. Tick.

    FANG has a market cap of $2.3bn i.e. 50% higher than RSPP for perhaps 100% more potential. I assume the acreage of both companies is largely similar in terms of resource potential because they are close neighbors.

    At face value FANG appears to be a better investment. FANG's production for 2014 is guided at 15,000-16,000 Boed, 100% above RSPP's recent output. Even if RSPP matched this production for 2014 there is still the question of FANG having double the acreage of RSPP.

    Can you provide more information as to why you recommend RSPP over FANG, especially when you consider the heavy insider selling at RSPP?
    Jan 16, 2014. 02:11 PM | 2 Likes Like |Link to Comment