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  • Unexpected Rivals Could Benefit From Boeing's 'Mistake' Not To Build A 757NG [View article]
    The A321 and 737-900ER don't really have the range or payload to replace 757's. That's why, for example, Delta is/will only able to use them as replacements on shorter routes out of ATL.
    May 20 09:52 AM | 1 Like Like |Link to Comment
  • Northern Tier Energy: Expect Lower Dividends In 2014 [View article]
    Isn't NTI buying all of it's crude at a significant discount to WTI? They process Bakken and Canadian crude.
    Feb 13 09:45 AM | 5 Likes Like |Link to Comment
  • Northern Tier upgraded at Macquarie, target price hiked to $37 from $21 [View news story]
    It's an MLP. There is no justification for a price target like that. Not that I mind.
    Nov 14 04:53 PM | Likes Like |Link to Comment
  • Lower WTI Oil Price Ahead [View article]
    On target analysis.

    That EOG slide is terribly misleading as it goes through March. Spring in the north central part of the US was horrible, late and long this year and it kept heavy trucks off the roads (due to thaw related problems) an extended period of time. And out of the fields.

    Current ND production running 900,000+ barrels as of August report.
    Nov 3 02:51 PM | 1 Like Like |Link to Comment
  • The Hedgeye Insight On Gathering Systems [View article]
    Hey, Hedgeye doesn't have to be right - they just have to sell the report.

    It's probably partly the case that Kevin Kaiser doesn't understand the oil and gas business very well - the short pipelines that KM put it to connect to these gathering systems and plants aren't full their entire useful life and no one in the industry expects that. The fact that his upcoming report apparently references gathering systems implies to me that he doesn't really understand how the industry is structured.
    Sep 6 12:35 PM | 4 Likes Like |Link to Comment
  • The Hedgeye Insight On Gathering Systems [View article]
    These are 10 or 20 year contracts that Kinder Morgan is signing. If anyone is at risk it's the E&P companies.
    Sep 6 11:34 AM | 7 Likes Like |Link to Comment
  • The Hedgeye Insight On Gathering Systems [View article]
    This is all fine but it has essentially nothing to do with Kinder Morgan's business as they aren't building the "capillaries" in the oil/gas business. Kinder Morgan (KMI/KMP/KMR) is building the interconnect and pre-selling access to it.

    If you look at Kinder Morgan's Eagle Ford gathering ( business you'll see it's 20+ inch pipe and they are connecting to customer processing plants under firm long term agreements with limited mileage. It's not truly a gathering system.

    Kevin Keiser's thesis looks like it's based on two half-baked ideas that are going to get shot down when he actually releases his report.
    Sep 6 08:30 AM | 40 Likes Like |Link to Comment
  • Gilead And Its Competitors In The Hepatitis C Race [View article]
    I am not overlooking it. I'm discounting it as being commercially significant.

    I think their window for opportunity is between initial sofosbuvir approval in 2014 and the eventual approval of sofosbuvir/5885 in 2015. Depending on their approval timeline, and I can't really tell what it is although it looks sort of like early 2015 to me, I don't think there is very much revenue available because Gilead's numbers look so good.

    Will they play a role in HCV therapy? Absolutely. I just don't see how the revenue is going to be very significant given the situation.
    Mar 22 10:19 AM | Likes Like |Link to Comment
  • Gilead And Its Competitors In The Hepatitis C Race [View article]
    It's clear the drug works - that's not what I'm saying.

    It will not be a commercial success as a stand-alone drug however. You have only to look at the HIV market to see the handicap that a multi-pill regime has. Gilead in particular has decimated its competition repeatedly using the combination therapy lever. You should look at their Triangle acquisition. They acquired Triangle for emtricitabine and paid $464M for what was essentially a clone of 3TC in order to coformulate and capture the 3TC revenue.

    In this case, they will be co-formulating with their own GS-5885 and Medivir's simeprevir, while comparable to GS-5885, isn't going to succeed commercially. I would expect that the standard of care for HCV in fact, is written specifying Gilead's combo - not with standing the portion of genotype 1 patients where apparently AbbVie is the leader there.

    VX-135 is even further behind but at least Vertex is willing to co-formulate.
    Mar 22 01:53 AM | Likes Like |Link to Comment
  • Gilead And Its Competitors In The Hepatitis C Race [View article]
    Abbott spun off all their HCV assets as part of AbbVie(ABBV).

    AbbVie is ahead of Gilead (according to Gilead) for some large portion of genotype 1 patients where approval (label) is expected in 2015. I don't fully understand this but it's part of the market that GILD won't get apparently.

    Gilead will still get the vast bulk of the HCV market in 2014 as you say.

    The Medivir drug is totally pointless. It would be a two pill combo competing with Gilead's own NS5A inhibitor one pill combo which is highly effective. I think it only makes sense for Medivir to pursue it thinking that they might partner it with something else - and I have no idea what that would be.
    Mar 21 03:46 PM | Likes Like |Link to Comment
  • After FDA Approval, A New And Bigger Catalyst Looms Closer For Immunogen [View article]
    My reading is that IMGN is only netting a 3-5% royalty on Kadcyla sales so at a market cap of 1.35B, isn't first line already full priced in?
    We're only talking roughly $40M/billion in sales so they will need serious sales simply to reach break even - I'm guesstimating $3B.

    I would be shocked if MARRIANNE failed.

    Don't know where estimates of 8-10 billion are coming from. Remember that only 30% of breast cancers over express HER2.
    Mar 18 11:49 AM | Likes Like |Link to Comment
  • A combination of Gilead's (GILD +0.6%) Sofosbuvir and Simeprevir, a drug being jointly developed by Medivir (MVRBF.PK) and Johnson & Johnson's (JNJ) Janssen unit, eliminates hepatitis C in all 80 patients in a Phase IIa study. The patients had failed to respond to other treatments. "We went for the most difficult to cure, with the idea if we could show good efficacy there, it could be assumed the regimen could be efficacious in other patient populations," says Gaston Picchio of Medivir partner J&J (JNJ +0.5%). (PR[View news story]
    Someone correct me if I'm wrong but I do not believe that Gilead and Medivir are actually partnered and this news is meaningless.
    I think this trial is something Pharmasset agreed to but that I am not aware of any marketing agreement that goes with it and no coformulation is contemplated. No mention in the 10-K.
    Mar 4 11:33 AM | 2 Likes Like |Link to Comment
  • Buy Delta Air Lines: Trainer Refinery Purchase And Improving Financials Will Lift The Stock [View article]
    This refinery is configured to produce 23,000 bpd of jet fuel, not 230,000 bpd.

    Additionally, it has been reported that Delta will be reconfiguring the refinery to produce a much larger proportion of jet fuel - something closer to 60,000 bpd.
    May 8 08:36 AM | 1 Like Like |Link to Comment
  • On That U.S. Natural Gas Storage Surplus [View article]
    The peak of natural gas drilling is already well past (2008) and the natural drop off of new wells has already happened.

    An unknown at the moment is the percentage of active rigs (600+) that are drilling for wet gas. Wet gas drilling is not going to stop because it's just SO profitable. Associated gas has already been mentioned.

    The other point here is that once you've drilled a well those costs are sunk (ha!) so you will only stop producing if the marginal cost is higher than the marginal profit. Most of these are new wells that require little maintenance at this point and the bulk of the costs are transport. problem is, a lot of the transport costs are firm commitments on long term deals so overall supply is very inelastic; supply will not readily drop.

    I would not be surprised to learn, as an example, that Chesapeake has already curtailed production as much as they realistically can.

    I keep reading that the easy coal to gas conversions have already been done and that standing in the way of any further shift from coal to gas is the long term coal supply contracts.

    Many utilities (but not mine!) have already shifted other power production from smaller coal plants to their gas peakers so if and when demand picks up it'll actually be coal plants that will increase their production - not gas.

    I should also point out that it has been WIDELY misreported that this summer is projected to be cooler than average. This is absolutely wrong. In fact, this summer is projected to be much warmer than average. Check the NOAA website for details. Again, I don't think this will make much difference to gas prices but for those of you who are (foolish) bulls, take heart.

    Bottom line, I think gas prices are absolutely locked into some intense downward pressure for 3-4 years which is when some of the large scale new demand sources will come on-line and the gradual coal to gas conversions will start to impact demand.
    Apr 20 12:34 PM | Likes Like |Link to Comment
  • Invest In Natural Gas, Commodity Of The Future [View article]
    I can't believe this was emailed to 100,000+ people.

    The statement that "LNG (liquified natural gas) is becoming a viable fuel source for many automobiles" is at best an error and at worst a fantasy. Perhaps the author meant Compressed Natural Gas (CNG) rather than supercooled methane.

    Exporting a few billion cubic feet a day of gas is insignificant and will not even dent production that will come on-line between now and 2016.
    Apr 10 10:16 AM | Likes Like |Link to Comment