Ophir Energy Share Discussion Threads

[spacedust] 25/9/2015 16:10

Ftse up, dow up, wti up, crude up yet we are in the doldrums fir most part of the day - crooks

[spacedust] 25/9/2015 15:56

Wti was 33dollars, now nearly 50$. It's gotta nothing to do with oil prices. It's pure sentiment which is controlled by MMS and everyone else is paralysed to do anything about it

[thegreatgeraldo] 25/9/2015 14:19

If they don't get any interest in a farm-in to Guinea, it won't be developed or they'll be looking to raise cash.

[nigelpm] 25/9/2015 14:15

All very true log.

[loglorry1] 25/9/2015 14:06

The trouble with the cash balance is that if Oil/LNG prices stay low then it won't be returned to shareholders. They'll find a way to spend it but that won't help if prices stay as low as they are. It will either be used to subsidise loss making SMDR fields or spent on exploration which even if successful the market probably won't rate. Not to mention G&A which will drag.

In any case unless LNG prices pick up the asset backing is an illusion and so there is will be little support other than the cash at 35p/shr or whatever.

I know this all sounds a bit grim but its much less grim than holding a company highly geared by debt to an oil price recovery e.g. PMO or IAE.

I suppose my point is that people think this share price is crazy but they are arguing from the perspective of oil prices rebounding in the medium to near term. Those selling presumably have a different view and one perhaps supported by the futures strip FWIW.

Log

[nigelpm] 25/9/2015 13:44

We'll have to beg to disagree on that one log.

If OPHR had little cash I'd probably agree.

But your point is a good one that it's been driven down on LNG/oil prices.

[loglorry1] 25/9/2015 13:31

It may not be a hugely popular view but I think OPHR isn't mis-priced at all give the current oil price and LNG outlook. It is clearly a bargain if LNG prices and general oil prices pick up again. It is mostly just a geared play on the underlying commodity where you are not exposed to contango and have a bit more comfort because of the large cash balance and decent management.

For sure until underlying commodity prices turn the share price is going nowhere.

Personally, I'm pretty happy with that as I think by this time next year we'll be in a better position regarding oil prices but I may be very wrong about that.

[nigelpm] 25/9/2015 10:03

Good summary Danger. I think it's always worth re-evaluating - I suspect on the fundamental side here LNG prices and outlook are having a major factor.

[dangersimpson2] 25/9/2015 10:00

Assuming it's a normal momentum strategy and not something more esoteric a short term spike won't change their position since the academic research shows that share prices are positively serially correlated over 6-12 months and negatively over 1 month or 3 years. So it is the meduim term downward trend that they will be likely trading on and won't reverse until the medium trend does. Of course their reversal will potentially give positive share price momentum when the meduim term trend does reverse.

While these strategies work on average they are very clearly not taking a view on an individual company. Therefore these sort of holdings are best ignored if you understand the underlying company well.

If any company started to get high short %ages from NON-quant hedgefunds then it would be worth re-evaluating since these are often very smart money. But even within these they tend in my experience to get too caught up in sector plays - e.g. death of UK high street, or oil companies in response to oil price drops rather than really evaluating each company for it's merits.

[nigelpm] 25/9/2015 09:23

Because there are plenty of institutions taking the other side as we've seen. At some point they'll take their profit and walk away.

[spacedust] 25/9/2015 08:47

Why would they plan their exit. Why not short more and more and bring it to 50p? They know they can. But then again if they are shorting millions of shares surely someone is buying. I mean after all the Polish chap selling hisentire holding ment someone bought it? Recently I've been told that buy sell cancel each other out and thru mean nothing.... I still don't understand that concept.

[nigelpm] 24/9/2015 23:38

Yup. Suspect they'll be planning their exit already. Might be as early as tomorrow.

[dangersimpson2] 24/9/2015 23:21

the quant funds will be following a momentum strategy and selling because the price is falling and its a big enough and liquid enough to get the borrow. They are not taking a fundamental view on the company and will reverse as rapidly as they sold. It may make the share price more volatile but it doesn't change the underlying value.

[nigelpm] 24/9/2015 20:25

Interesting - they'll be out soon i suspect.

[spacedust] 24/9/2015 19:51

You only require sentiment and nothing else. Remember back in 2009 when all gold shares regardless of their market cap multi bagged. Even small aim companies who had no cash nogold nothing went up.

[spacedust] 24/9/2015 17:40

Could ophr Glenmore evraz hit 50p??? If market makers want it im sure they could make it fall to 20p. Lmi 18 soon could be 12p

[nigelpm] 24/9/2015 16:25

It's the cash point and capital commitments Mike.

It doesn't make sense when they'd have to borrow later.

[ed 123] 24/9/2015 15:51

I think they learned their lesson with share buybacks.

LNG price may easily fall further next year. How daft would they look buying now, if it falls to 60p next year?

More importantly, their cash is important to them.

[nav_mike] 24/9/2015 15:46

Beats me why the dont restart the share buyback program. They were happy enough to do it when the share price was way higher.

Even if started on a small scale it would give the shorting hedge funds something to think about.

Or dont they believe 78p under values their company?

[spacedust] 23/9/2015 16:16

Vw will be fined millions. Bad publicity but guess what......the Vw shares are up5%. Markets make perfect sense

[nigelpm] 23/9/2015 16:08

couldn't agree more tsmith. Very hard to do though.

[tsmith2] 23/9/2015 15:40

Case of tucking a few away and forgetting about them

[spacedust] 23/9/2015 14:47

Ophr is out of favour. They could easily have trillions of cash in the bank but if the crooks in the city want to tank it down then they can and every one else is paralysed to do anything about it at all. Cairn with its debt pile are more favoured