Natural Gas Prices Hit Multi-Year Lows: Winners And Losers [View article]
Asset sales are one time deals. How many do they have left to sell? I'm pretty sure they've already sold off a piece of every play they are involved in. Are they going to keep selling chunks? What happens when they sell all the chunks?
The capital expenditure to attempt to HBP this much acreage is massive, as we can see from their cash flow statement. If I understand how they are showing D&C costs on the cash flow statement (a net amount of CHK expenditures minus drilling carries), capital expenditures have been over 7 billion in the first 3 quarters. That's 2-3 billion more than APA, APC, DVN, & EOG. Even COP, a company 7 times bigger by market cap, is only at 9 billion!
Chesapeake's Mississippi Lime Joint Venture Falls Woefully Short Of Expectations [View article]
The problem is extrapolation. Plain and simple. Just because you get one sucker to overpay doesn't mean the rest of the acreage is worth that price. This is especially true when you are dealing with the Chinese who, to some extent, don't care about economics. They want knowledge and want to use their dollars to buy hard assets. Knowing that, makes you wonder what any private US company would have offered LOL. Another issue is companies not wanting to work with CHK as a joint partner.
I really feel like some of these companies paying huge dollars for land really don't care about economics or have extremely small target ROR. Project economics get crushed when you factor in these huge land costs. $10,000 an acre on 160 acre well spacing gives a $1.6MM burden to each well that has to be overcome. Same goes for infrastructure, etc. Infrastructure costs are huge in the Miss. These costs likely aren't getting captured in the ROR/type curve slides investors are seeing.
As far as the Miss goes, from public information, it appears to be pretty marginal with the occasional super good well carrying everything.
Finally - Reality Is About To Hit Amazon Shareholders [View article]
What a terrible earnings report. They missed every metric and had a profit margin in the Christmas quarter of 0.45%? Really? Who wants to own a business that makes 45 cents on every 100 dollars they sell? Not anyone sane.
Shorts had it right at the beginning of AH driving the price to under $250. Then the algos kick in and ramp the stock to $290 on bad news.
Shorting this garbage is futile. The market can remain irrational longer than you can remain solvent. Just sit back and watch the fireworks as longs get absolutely destroyed some day in the future with no shorts to cushion the blow. He who panics first panics best. One day someone will panic and it will be ugly.
RIM's BB10 Chances Better Than Analysts Expect [View article]
Yep. For years they sat around not innovating and putting out garbage because they were at the top. They thought AAPL was not going to compete with the BB. Boy were they wrong.
The author expects sales of 25M units in FY14. AAPL did more than that last quarter in iphones. On the tablet side, the playbook is a total joke. I think they've sold something like 2 million units total since inception? AAPL sold 14M ipads last quarter.
RIMM has a LONG way to go if they want to even remotely compete with AAPL. I think a large portion of the users of BB in the "developed" world are governments and corporations. Even they are switching to the iPhone. The "developed" world for RIMM might be a case of too little too late and depending on how BB10 is and how the price comes down on iPhones, the "undeveloped" world may follow.
Not sure what stickman is talking about, but 100,000 to 200,000 gallon total volume frac jobs are extremely small and would only be seen on a vertical well. Even then, slickwater fracs can be double or more of that size even on a single stage vertical frac.
Oil and gas wells are most commonly drilled within 1 sq mi. section boundaries and thus limited to ~4000 ft of lateral. These are typically 12-30 stages depending on the operator and their beliefs as to what will give them the best well. The volume of each stage can vary just as easily as the total number of stages. 100,000-200,000 gallons is fairly common for a single stage on a horizontal well. Again, this varies based on the thoughts of the operator. Do the math and you are easily at over a million gallons for a small frac job on a horizontal well.
The Light At The End Of Facebook's Lockup Tunnel [View article]
A 200 million+ share shakeout? Massive volume on the first day that a huge lockup expired? Nothing fishy going on?
Who is going to say to themselves: We know there is going to be massive selling today because of employees ready to cash out, so instead of letting it drop, slowly buying, and getting the shares at a 10% or whatever discount, we should blow our whole load at the open, buy them all up regardless of price and actually make the stock go up 12%.
Top 10 Pick: Amazon Financials Understate Growth [View article]
Like I said above, they have been saying this for years. "We are trying to get market share then we will make money" It never comes. Amazon's margins are terrible and to say that they can just all of a sudden bump them to 5% is rather silly. Like Paulo says...who does that? Do they just wake up one morning and say, alright let's try to make some money now.
Last quarter's operating margins were 0.8%. YTD is 1.1%. Would you start a business with these margins? That's like you owning a million dollar business (pretty big for the average person) and only making $8,000. That's not even worth it except to the folks who are getting rich off of it: http://yhoo.it/TGcpCJ
Amarin NCE Decision Delayed Again: What The 8-K Really Tells Us [View article]
I definitely agree with others that this was a hack job and not on par with your other work. All subjective with no facts.
Why would the FDA would delay twice and not be at least considering NCE? Why not just deny it from the start? Why not deny it these last two months?
Of course the company is going to still be using the "three paths of commercialization" language, they haven't said otherwise! Perhaps they aren't ready to say otherwise. I would say that key personnel are going to be hired either way because AMRN needs to be ready to bring the drug to market regardless of the path they choose. Nothing in AMRN's statement shows that they are going at it alone. What's to say a buyout isn't already inked or will be inked pending NCE status? How do you dispute something like that? You can't because the whole article is subjective.
The market has reversed the mid-day drop this article caused. My question is, did you at least get a chance to add to your long position in the panic you caused by your subjective interpretation of the 8K?
Gulf Keystone Petroleum: What Is The 14 Billion Barrel Shaikan Field Worth? [View article]
There's no doubt the field is worth that much or more. The biggest factor in the whole deal is that Iraq needs to get their crap together and figure out the oil & gas law. Really beginning to wonder if Biden was right and the country will be split into three.
Where Will Chesapeake Energy's Cash Come From? [View article]
Actually, they did have gas hedged until management decided to speculate with the companies hedges. AM removed them because they thought nat gas was temporarily depressed over Greece. Cash flow hedges are not meant to buy low and sell high. They are there to smooth out cash flow. They thought they were smarter than the market and got burned. You would have thought that Aubrey would have realized this after his margin call, but the arrogance still lives on.
Exactly. The Chinese are not after these deals for economics. They want the knowledge to take back home and the ability to convert their massive USD reserves into hard assets and not US debt. This is where folks go wrong valuing these assets. Just because someone will overpay for part of an asset doesn't mean the rest of it is worth that. CHK tries to market their company to investors in this way. "Well someone bought some of our acreage for $20,000 an acre, that must mean we can apply that to all of the acreage we have" One of their presentations has Eagle Ford acreage valuation listed as high as $50,000 an acre. It's laughable. On 320 acre spacing and $100/bbl you'd have to sell 160,000 bbl of oil just to cover land costs. It's a joke.
Amazon Prime Has Improved My Life, And Will Improve Company Profits [View article]
Prime is strictly to bump revenues. Look at the net shipping costs AMZN eats. It's insane. Not sure how you can call this a profit improver. AMZN has always been about having the highest revenues and making excuses on when the profits are coming.
You can have a king size mattress sent overnight for 4 dollars. Really? have you ever gotten on UPS and seen what it would cost to overnight something of that size/weight? Now granted AMZN will have discounted shipping compared to the UPS retail, but still...4 dollars?
It Is Chesapeake's Board Of Directors That Needs To Go First [View article]
So if something is in the past that makes it ok or we should just forget about it? It tells you nothing about AM's character? Tells you nothing about how much he cares about the shareholders? Nothing about the integrity of the board?
Would you care if AM was trading against the company or using inside info from CHK to profit personally? Well he definitely had the opportunity to do it. And from the sounds of it, he used CHK property to run the hedge fund without compensating CHK and also dedicated a great amount of time to it. This is a classic conflict of interest topped by the fact that it was ok'd by the board?! You're ok with this? WTH is wrong with you?
I have no position either way right now, but I have been short before. I will probably never be a shareholder unless AM and the board go.
And yes I do think Tom Ward had the same conflict of interest. Both were in very privileged positions and should not be trading for their own account.
Chesapeake Energy: Buy Into The Weakness Post-Earnings [View article]
AM is essentially using the company hedges to spec in nat gas. Trying to buy low and sell high. That's not the purpose of hedges. Too much arrogance with him. He thinks he's bigger than the market. Too much of a wildcard.
Natural Gas Prices Hit Multi-Year Lows: Winners And Losers [View article]
The capital expenditure to attempt to HBP this much acreage is massive, as we can see from their cash flow statement. If I understand how they are showing D&C costs on the cash flow statement (a net amount of CHK expenditures minus drilling carries), capital expenditures have been over 7 billion in the first 3 quarters. That's 2-3 billion more than APA, APC, DVN, & EOG. Even COP, a company 7 times bigger by market cap, is only at 9 billion!
Chesapeake's Mississippi Lime Joint Venture Falls Woefully Short Of Expectations [View article]
I really feel like some of these companies paying huge dollars for land really don't care about economics or have extremely small target ROR. Project economics get crushed when you factor in these huge land costs. $10,000 an acre on 160 acre well spacing gives a $1.6MM burden to each well that has to be overcome. Same goes for infrastructure, etc. Infrastructure costs are huge in the Miss. These costs likely aren't getting captured in the ROR/type curve slides investors are seeing.
As far as the Miss goes, from public information, it appears to be pretty marginal with the occasional super good well carrying everything.
Finally - Reality Is About To Hit Amazon Shareholders [View article]
Shorts had it right at the beginning of AH driving the price to under $250. Then the algos kick in and ramp the stock to $290 on bad news.
Shorting this garbage is futile. The market can remain irrational longer than you can remain solvent. Just sit back and watch the fireworks as longs get absolutely destroyed some day in the future with no shorts to cushion the blow. He who panics first panics best. One day someone will panic and it will be ugly.
Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date [View article]
RIM's BB10 Chances Better Than Analysts Expect [View article]
The author expects sales of 25M units in FY14. AAPL did more than that last quarter in iphones. On the tablet side, the playbook is a total joke. I think they've sold something like 2 million units total since inception? AAPL sold 14M ipads last quarter.
RIMM has a LONG way to go if they want to even remotely compete with AAPL. I think a large portion of the users of BB in the "developed" world are governments and corporations. Even they are switching to the iPhone. The "developed" world for RIMM might be a case of too little too late and depending on how BB10 is and how the price comes down on iPhones, the "undeveloped" world may follow.
Fracked Water, Meet SmartSponge [View article]
Oil and gas wells are most commonly drilled within 1 sq mi. section boundaries and thus limited to ~4000 ft of lateral. These are typically 12-30 stages depending on the operator and their beliefs as to what will give them the best well. The volume of each stage can vary just as easily as the total number of stages. 100,000-200,000 gallons is fairly common for a single stage on a horizontal well. Again, this varies based on the thoughts of the operator. Do the math and you are easily at over a million gallons for a small frac job on a horizontal well.
The Light At The End Of Facebook's Lockup Tunnel [View article]
Who is going to say to themselves: We know there is going to be massive selling today because of employees ready to cash out, so instead of letting it drop, slowly buying, and getting the shares at a 10% or whatever discount, we should blow our whole load at the open, buy them all up regardless of price and actually make the stock go up 12%.
Makes perfect sense.
Top 10 Pick: Amazon Financials Understate Growth [View article]
Last quarter's operating margins were 0.8%. YTD is 1.1%. Would you start a business with these margins? That's like you owning a million dollar business (pretty big for the average person) and only making $8,000. That's not even worth it except to the folks who are getting rich off of it: http://yhoo.it/TGcpCJ
Amarin NCE Decision Delayed Again: What The 8-K Really Tells Us [View article]
Why would the FDA would delay twice and not be at least considering NCE? Why not just deny it from the start? Why not deny it these last two months?
Of course the company is going to still be using the "three paths of commercialization" language, they haven't said otherwise! Perhaps they aren't ready to say otherwise. I would say that key personnel are going to be hired either way because AMRN needs to be ready to bring the drug to market regardless of the path they choose. Nothing in AMRN's statement shows that they are going at it alone. What's to say a buyout isn't already inked or will be inked pending NCE status? How do you dispute something like that? You can't because the whole article is subjective.
The market has reversed the mid-day drop this article caused. My question is, did you at least get a chance to add to your long position in the panic you caused by your subjective interpretation of the 8K?
Gulf Keystone Petroleum: What Is The 14 Billion Barrel Shaikan Field Worth? [View article]
Where Will Chesapeake Energy's Cash Come From? [View article]
And now to the rescue: Chesapeake Energy (CHK) says it's gotten a $3B unsecured loan from Goldman Sachs and Jefferies Group, to be repaid from those 2012 asset sales. [View news story]
Amazon Prime Has Improved My Life, And Will Improve Company Profits [View article]
You can have a king size mattress sent overnight for 4 dollars. Really? have you ever gotten on UPS and seen what it would cost to overnight something of that size/weight? Now granted AMZN will have discounted shipping compared to the UPS retail, but still...4 dollars?
It Is Chesapeake's Board Of Directors That Needs To Go First [View article]
Would you care if AM was trading against the company or using inside info from CHK to profit personally? Well he definitely had the opportunity to do it. And from the sounds of it, he used CHK property to run the hedge fund without compensating CHK and also dedicated a great amount of time to it. This is a classic conflict of interest topped by the fact that it was ok'd by the board?! You're ok with this? WTH is wrong with you?
I have no position either way right now, but I have been short before. I will probably never be a shareholder unless AM and the board go.
And yes I do think Tom Ward had the same conflict of interest. Both were in very privileged positions and should not be trading for their own account.
Chesapeake Energy: Buy Into The Weakness Post-Earnings [View article]