Jadestone Energy Share Discussion Threads

[mount teide] 29/11/2022 17:36

Never thought I'd live to see the day I would hear the level of dissatisfaction and colourful language I do now, at our local Conservative Association meetings, when discussing the leadership and direction of the Party/Government......most of the membership are absolutely fuming at the behaviour of PM Hunt and his deputy in training Sunak.

[fardels bear] 29/11/2022 16:30

Many Tory voters are apoplectic with rage at this shower. I'm one of them.

[fardels bear] 29/11/2022 15:36

God alone knows what the debt would be and how far the economy would have collapsed had your pinko pals been in charge of the shop over the last three years.

[fardels bear] 29/11/2022 14:27

They could pay for them out of the imaginary money that labour uses for everything.

[kaos3] 29/11/2022 10:58

or as it is done in my place .... pumping water to a higher altitude for the later hydro el production...

[ngms27] 29/11/2022 10:18

The only way I can see wind power working is as follows:1) Wind power producers make approx 50% more when the wind is blowing but there is no demand. This is usually overnight but can be due to lack of connectivity between Scotland and England. They thus are paid handsomely to shut down. This is the green levy on our bills.2) Producing green hydrogen is about 50% efficient. I.e it takes 2 units of electricity from Wind to make 1 unit of electricity from Hydrogen produced.3) Rather than shutting down wind when there is no demand why don't we produce hydrogen? This is effectively energy storage and the suppliers get paid the normal rate NOT the enhanced shut down rate. The hydrogen can be used for vehicles or power stations etc. This cost wise is 75% efficenct.It needs Government to do this.

[fardels bear] 29/11/2022 08:35

That was always the problem with a get out of jail free card. Anticyclonic conditions bring cold but windless days. Everybody knows this. It's the major reason I never bothered with renewables on my house. No sun in winter, no wind when it's very cold.

[tom111] 28/11/2022 21:29

May have to wait till March March winds will blow-----

[mount teide] 28/11/2022 21:18

Unreliability of renewable energy laid bare today in the UK.

'Over the last 40 hours, the UK wind power industry has swung from producing 16.4 GW to generating 0.4 GW

The drop in electricity production is equal to, give or take, switching off 14 nuclear power stations. That's the reason why UK power markets are tight today.' Javier Blas / Bloomberg

[tom111] 28/11/2022 17:55

No surprises there Albert

[royalalbert] 28/11/2022 17:48

A production cut at the meeting on Sunday is being talked about apparently.

[tom111] 28/11/2022 17:40

So oil well up over 2% after been down near 5% in Asia doesnt pay to second guess this market

[tanners] 28/11/2022 15:20

Amaretto - you've made your point about 20 times, so how about leaving it there and like you said coming back in March 23......or preferably not at all.

[tom111] 28/11/2022 15:04

As a reminder OPEC meets on Sunday the day before EU makes a decision on the cap imposed on Russian oil,its going to be an interesting week ahead.

[tom111] 28/11/2022 14:44

A long and detailed assessment of the state of the oil market by the ft "The week that could unravel the global oil market"Very bullish imo

[mount teide] 28/11/2022 14:09

Continue to read plenty of high quality research on the oil market, but seen little to argue against the Saudi's view's, which is one that some of us have been writing about and investing accordingly since 2017. That what will be driving the oil market and global energy crisis over the rest of this decade is the catastrophic collapse in E&P Capex since 2014. EVERYTHING ELSE IS JUST BACKGROUND NOISE BY COMPARISON.

Of course, as Jeff Currie at Goldman explained well, future oil price movement will not be straight up but, broadly follow a pattern as in past periods of supply tightness that are structural(created by a lack of investment)......they will be a series of spikes up and down from a high floor price.

Consequently, aș a long term investor in an oil market that has been starved of investment since 2014, have been using recent oil price weakness to add to my O&G and shipping positions.

However, been a little disappointed not to have got more 'value'.

Seems the reason for this is that more of the mainstream investment market has now spotted, something some of us have been writing about for 9 months, that even at $75 oil, the now super lean oil producers have already proved they can still deliver all time record levels of FCF.


Something that analyst Alex Kimani at Oilprice.com has been writing about this week:

Oil Stocks Are Showing A Peculiar Disconnect From Crude Prices

* Oil prices are showing a peculiar disconnect with energy stocks.

* The current disconnect hasn’t been seen since 2006.

* Shareholders remain bullish on the energy sector as firms continue to pay strong dividends.


'Oil stocks have continued to show a peculiar disconnect from the commodity they track, with oil equities staging a powerful rally even as oil prices have fallen sharply since the last OPEC meeting.

Over the past two months, the energy sector’s leading benchmark, the Energy Select Sector SPDR Fund (NYSEARCA: XLE), has climbed 34% while average crude spot prices have declined 18%. XLE now boasts a 61.2% return in the year-to-date, the best of any U.S. market sector.

According to Bespoke Investment Group via the Wall Street Journal, the current split marks the first time since 2006 that the oil and gas sector has traded within 3% of a 52-week high while the WTI price retreated more than 25% from its respective 52-week high. It’s also only the fifth such divergence since 1990.

The U.S. oil majors have not disappointed, either: over the past two months, Exxon Mobil Corp. has gained 35.3%; Chevron Corp. is up 30.6%, ConocoPhillips has climbed 30.1%, Phillips 66 has rallied 45.3% while Marathon Petroleum Corp has returned 40.3%. This trend rings true even for shorter timeframes, with all the stocks here being in the green over the past five trading sessions with the exception of COP which is down 0.5%.

There’s a method to the madness, though.

Strong Earnings

Robust earnings by energy companies are a big reason why investors are still flocking to oil stocks.

Third quarter earnings season is nearly over, but so far it’s shaping up to be better-than-feared. According to FactSet’s earnings insights, for Q3 2022, 94% of S&P 500 companies have reported Q3 2022 earnings, of which 69% have reported a positive EPS surprise and 71% have reported a positive revenue surprise.

The Energy sector has reported the highest earnings growth of all eleven sectors at 137.3% vs. 2.2% average by the S&P 500.

At the sub-industry level, all five sub-industries in the sector reported a year-over-year increase in earnings: Oil & Gas Refining & Marketing (302%), Integrated Oil & Gas (138%), Oil & Gas Exploration & Production (107%), Oil & Gas Equipment & Services (91%), and Oil & Gas Storage & Transportation (21%).

Energy is also the sector that has most companies beating Wall Street estimates at 81%. The positive revenue surprises reported by Marathon Petroleum ($47.2 billion vs. $35.8 billion), Exxon Mobil ($112.1 billion vs. $104.6 billion), Chevron ($66.6 billion vs. $57.4 billion), Valero Energy ($42.3 billion vs. $40.1billion), and Phillips 66 ($43.4 billion vs. $39.3 billion) were significant contributors to the increase in the revenue growth rate for the index since September 30.

Even better, the outlook for the energy sector remains bright. According to a recent Moody's research report, industry earnings will stabilize overall in 2023, though they will come in slightly below levels reached by recent peaks.

The analysts note that commodity prices have declined from very high levels earlier in 2022, but have predicted that prices are likely to remain cyclically strong through 2023. This, combined with modest growth in volumes, will support strong cash flow generation for oil and gas producers. Moody’s estimates that the U.S. energy sector’s EBITDA for 2022 will clock in at $$623B but fall to $585B in 2023.

The analysts say that low capex, rising uncertainty about the expansion of future supplies and high geopolitical risk premium will, however, continue to support cyclically high oil prices. Meanwhile, strong export demand for U.S. LNG will continue supporting high natural gas prices.

In other words, there simply aren’t better places for people investing in the U.S. stock market to park their money if they are looking for serious earnings growth. Further, the outlook for the sector remains bright.

Whereas oil and gas prices have declined from recent highs, they are still much higher than they have been over the past couple of years hence the ongoing enthusiasm in the energy markets. Indeed, the energy sector remains a huge Wall Street favorite, with the Zacks Oils and Energy sector being the top-ranked sector out of all 16 Zacks Ranked Sectors.

Share Buybacks

Further, earnings in the sector are likely to remain high due to high levels of share buybacks. Oil and gas supermajors are on course to repurchase their shares at near-record levels this year thanks to soaring oil and gas prices helping them to deliver bumper profits and boost returns for investors.

According to data from Bernstein Research, the seven supermajors are poised to return $38bn to shareholders through buyback programmes this year, with investment bank RBC Capital Markets putting the total figure even higher, at $41bn.

In 2014, when oil was trading over $100/barrel, we only saw $21 billion in buybacks. This year’s figure easily outpaces the 2008 number.

But here’s another interesting thing: Big Oil’s capex and production have remained mostly flat despite reporting record second-quarter profits.

Data from the U.S. Energy Information Administration (EIA) shows that Big Oil companies have mostly downshifted both capital spending and production for the second-quarter. An EIA review of 53 public U.S. gas and oil companies, responsible for about 34% of domestic production, showed a 5% decline in capital expenditures in the second-quarter vs. Q1 this year.

Cheap Energy Stocks

Another surprising finding: energy stocks remain cheap despite the huge runup. Not only has the sector widely outperformed the market, but companies within this sector remain relatively cheap, undervalued, and come with above-average projected earnings growth.

Key Metrics for O&G Sector

PE
8.19 - Energy
16.42 - S&P 500

Peg Ratio
0.58 - Energy
1.89 - S&P 500

Proj EPS Growth
95.62% - Energy
6.38 - S&P 500

[vaston] 28/11/2022 13:31

Wow, this is real , check the company out.
htTps://www.the-financialnews.com/?p=4057

[tom111] 28/11/2022 12:53

Opec stated 7 days ago that they would intervene if necessary and cut production, thats on the table as they want oil prices @80-$90

[jeff114] 28/11/2022 10:15

The lower the shareprice goes the more they can buy and the lower oil price goes the cheaper the deals they can do... so in each case a good investment

[tom111] 28/11/2022 09:34

Saudis will probably reduce production next week they are in full control of the price NOW

[amaretto1] 28/11/2022 09:34

If jadestone were not buying ....Were would the share price be ???