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BP Play Still Alive, Lookout!

 At the current price some people maybe thinking that it is too late to get in on BP. I say not yet.


Thesis Points

1. Protected Downside

Stabilization of prices at a 30-33 price range or lower will engender hostile tender offers.  Buying at the dip of BP as a result of negative news (Tropical Storms, Oil leaks) will be a good opportunity to enter this position. Secondly, there is a lot of interest in BP assets, if all else fails selling these assets will warrant a substantial cash injection.


2. Oil Well Final Seal Catalyst

Any news regarding “Top Kill” or the final sealing of the well will engender upward price pressure. Note: BP and Coast Guard strategy is under-promise and over-deliver. This is good news for investors.


3. Earnings Catalyst

There is a negative expectation of BP earnings. However incorporating,

- Oil prices  

- The relative size of BP revenue with respect to 3 billion or 4 billion (1.6%)

- They are collecting oil from the well that they can probably still be able to sell

BP earnings might outperform the minds of many investors. But if enough people with enough money reads this article, maybe not so. That’s what makes investing interesting.


I would like to keep my article short, sweet, to the point and in a readable format. If you would like further data or more details or to tell me I am wrong, then please feel free to comment and I shall respond as openly and as wordy as possible. I enjoy contrarian thought.


Disclosure: One Call Contract, to me investing is not about the money, but my mentor told me to put my money where my mouth is.