BPT - Beach Energy

[Kauri]

Kauri
Excellent short here - this thing just keeps slipping, the sellers are abundant. The continued downtrend that I had predicted back a little while ago after the brake down out of the sidewards movement has accelerated rapidly. Brokers are saying this one's a screaming buy - personally, I wouldn't touch the thing with a 40 foot pole!

Cheers

Hi Reece..
If the brokers who reckon it's a screaming buy had put their money where their mouth is then maybe they would have managed to stop the rout. I'm not sure that even a 40ft pole would be long enough to be able to reach this one at the moment.
By my elementary E/W I do however think that a bottom may not be far off, but after a long substained fall like this I don't think it will turn on a dime. Maybe bottom out, advance a bit, re-test the bottom, before trying to get some northward movement.
Cheers.. Kauri

 

[rederob]

Hi Reece..
If the brokers who reckon it's a screaming buy had put their money where their mouth is then maybe they would have managed to stop the rout. I'm not sure that even a 40ft pole would be long enough to be able to reach this one at the moment.
By my elementary E/W I do however think that a bottom may not be far off, but after a long substained fall like this I don't think it will turn on a dime. Maybe bottom out, advance a bit, re-test the bottom, before trying to get some northward movement.
Cheers.. Kauri

Kuari
Sorry to interrupt your transmission.... again.
My simple "support" line is broken near $1.15 so I would be looking at buying - actually "adding" to a small holding I took last year.
However, my fundamental view is that it is 2-3 months early to buy into an oiler, so I will re-enter BPT nearer $1.10 - my strategy is 2 entries of 10k shares.
The company is quite sound and has suffered the pains of an over-expensive acquisition that looked good while oil was still trending up to $80 rather than down to $50.
The POO cycle suggests another tilt at $50, so if in the next few months both my hurdles are jumped, so will I.

I see 2007 as a relatively "steady state" for oil prices, unless hurricanes damage rigs again in GOM. But I see 2008 as the year all hell can break loose as that is when the Saudi's will have to pull out all stops to keep the world's economic engines (literally) running.
My view is that Peak Oil will talked about then just as "climate change" is now - that is, by a better informed scientific (engineering) community rather than economists and politicians.

 

[Freeballinginawetsuit]

Kauri
Excellent short here - this thing just keeps slipping, the sellers are abundant. The continued downtrend that I had predicted back a little while ago after the brake down out of the sidewards movement has accelerated rapidly. Brokers are saying this one's a screaming buy - personally, I wouldn't touch the thing with a 40 foot pole!

Cheers

Nice Call, NOT!.

 

[reece55]

Nice Call, NOT!.

Yeah, ok mate..........

If you review my earlier post, I stated not to enter this one when it was at 1.30..... last time I checked, if I was short (which i'm not) I would still be in the money by about 10% even after todays move upward.

Todays action may make me revisit my analysis, but mate a bounce is still just a bounce - a trade long here is still a trade against the trend. But good luck if you like catching knives! The raw fact is they paid too much for Delphi - its just that simple if you ask me.

Cheers

 

[Bush Trader]

Yeah, ok mate..........

If you review my earlier post, I stated not to enter this one when it was at 1.30..... last time I checked, if I was short (which i'm not) I would still be in the money by about 10% even after todays move upward.

Todays action may make me revisit my analysis, but mate a bounce is still just a bounce - a trade long here is still a trade against the trend. But good luck if you like catching knives! The raw fact is they paid too much for Delphi - its just that simple if you ask me.

Cheers

Another opinion perhaps, at this sp the market places little value on any exploration upside or perhaps the true discounted cashflows atributable to Delhi?

I'm not a holder, however I've been watching it closely for some time, and of course are interested in all your comments. The 40 ft barge pole remark concerns me somewhat, however that why we all follow this site - to be challanged in our opinion.

The peake oil theory is also open to conjecture - less oil/growing demad by oil stocks used to be my opinion. Now i look at as by oil stocks market disapointed by down trend in production SP punished - we all need oil stocks with stong cash flows and reserves, exposed to the upside in the oil price, and hopefully the right exploration plot!

Cheers BT


Overlooking The Beach

Source: FN Arena News - February 14 2007
By Greg Peel

"Now that Beach should be joining the big league, it follows that more leading brokers will initiate coverage of the stock. This usually means share price support, particularly as fund managers will start to take an interest."
I wrote that in September. I was wrong, wrong, wrong. The Beach Petroleum (BPT) share price has since fallen steadily from $1.60 to under $1.20 and still only one broker in the FNArena database of leading brokers and researchers – Merrill Lynch – covers the stock. However, Intersuisse covers the stock, and the analysts believe it is the market that is wrong, wrong, wrong.
Beach Petroleum leapt into the headlines last September when it went from oblivion to the fifth largest oil and gas company on the ASX. Beach shocked the market by significantly gazumping sector heavyweight Santos (STO) in its bid for Delhi Petroleum. While the price was a full one, Merrill Lynch suggested the jump in scale and size would generate a lot more interest in Beach.
Beach has secured the share in Delhi. However, apart from paying a full price, the company had to significantly expand its capitalisation through debt facilities and capital issues. This was not well accepted by the market. To top things off, the oil price has been in decline ever since.
Moreover, Beach had previously been a "serial underperformer", poor at managing investor relations, poor at attracting analyst interest and not a good payer of dividends, notes Intersuisse. A whole raft of reasons why no one much has given the company a second thought since.
But Intersuisse believes the market will finally begin to re-rate Beach as it sees "tangible evidence of strong operating and financial performance, likely over the course of FY07". Another reason why the market is slow to move, says Intersuisse, is because it's waiting for the first half result on February 28. That result will probably be slightly down on the previous corresponding period, the analysts expect, but the second half result should be "much stronger", and FY08 even stronger still.
The acquisition of Delhi, effective from January, has increased Beach's "barrels of oil equivalent" from 63m to 101m, and shifted its gas/oil ratio from 90/10 to 70/30, notes Intersuisse. Beach believes Delhi's reserves, particularly of oil, can be substantially lifted. Beach also has fingers in pies elsewhere, including the Gippsland and Cooper Basins (oil & gas), as well as a coal seam gas project in Queensland and, according to the analysts, an "important and growing presence in the renewable energy sector".
Beach is also exploring vigorously, and will participate in about 100 appraisal wells in FY07.
Intersuisse is forecasting a first half profit just under $30m, but a full year FY07 profit of $120m, rising to $185m in FY08 as various projects kick in. The analysts rate the stock a Buy.
So too does Merrill Lynch, having done so back in May last year. The analysts are maintaining a target price of $2.00. The stock closed at $1.125 yesterday.

 

[Kauri]

The volume over the past month coupled with the basing price action suggests steady accumalation to me, todays action although positive suggests that there are still sellers out there. The next few days will be interesting.

P.S... Red, I've dusted off the running shoes but haven't got down in the blocks for the 110mtr hurdles yet.

 

[reece55]

Agree Kauri.... I would expect a short rise, then a retest of those lows .... The sellers haven't left the game yet IMO. However, I also agree that the fundamental investors have been accumulating at the lower end of the rot.... The problem IMO has been that anyone who accumulated the stock over that period Sept - Dec is well in the red..... However we will probably find that most are now out....

BT, I agree that at these levels BPT is looking attractive from a valuation perspective. The premium they paid for Delphi appears to now have been diluted and certainly the market appears to be undervaluing them from an NPV perspective. But the market can undervalue companies for years and with so many other stocks showing incredible performances, I want price confirmation to convince me to take a long position.

Cheers

 

[rederob]

kauri
I liked today's bounce.
I am now more hopeful of a $1.10 entry than yesterday: I agree on the "sellers" point.
But I am not keen to even put on the running shoes this early, unless the starter calls me to the blocks.

reece
I don't look for confirmation, as a rule; just my personal "value' criteria.
For example, were I in the market for KZL I would have got it last week and been 10% better off today.

BT
The only people that don't believe in "peak oil" are the people that haven't looked at the data from M King Hubbert and his many oil community experts over the past 50 years. Issue is not "if", it's "when". My view is that it will occur before 2010 unless a Gawhar is brought on line beforehand: Slim chance, because we have to find one first!

 

[reece55]

Rederob
I actually traded that KZL bounce myself and made a few $$ - but it showed very different characteristics to that of BPT - KZL showed heavy accumulation and a support base.... BPT on the other hand shows me an accelerating downtrend that is near and end, but will probably hit your 1.10 target. When I say price confirmation, I include volume and price in the equation.

Good luck with getting the 1.10 entry - if it breaks 1.25 on high vol tomorrow with a close on the highs again, you might find the starters gun has commenced. Otherwise I would say we will hit your target and bounce nicely off it.

Cheers

 

[Freeballinginawetsuit]

Yeah, ok mate..........

If you review my earlier post, I stated not to enter this one when it was at 1.30..... last time I checked, if I was short (which i'm not) I would still be in the money by about 10% even after todays move upward.

Todays action may make me revisit my analysis, but mate a bounce is still just a bounce - a trade long here is still a trade against the trend. But good luck if you like catching knives! The raw fact is they paid too much for Delphi - its just that simple if you ask me.

Cheers

Catching a falling knife is a comparitive term and IMO should be reserved to high volume speculative stocks with no real fundamental value......bar hype and an SP rise. Gambling in real terms .

It is difficult to put a real value on Oilers, BPT is a rarity and not cut from that mould.

Sure BPT paid a premium for Delhi, just like punters who purchased oil stocks during that period. Oil corrected........and most of the canny punters would have liquidated early.

You are incorrect in your assumption that BPT holders from high prices are out ATM. The vast majority of long termers and insto's from the delhi aquisition would still be in. BPT's slide is from short term traders punting on a rise that has never happened and cutting small percentage losses.

The ones who exited months back are in the sidelines biding their time waiting for the value and it is these who will decide when the bottom is met and the value fundamental punters kick in.

So yeah mate....Im catching BPT now and every time it drops under a $1.15, I will be accumalting reasonable parcels till I'm happy with my holdings. . Todays price action wiped an intraday trend with sudden volume, wear youre blinkers if you want the big punters certainly are not!.

 

[reece55]

Freeball
I think its a big call to say the instos and holders from Delphi are still there - there are no sub holders here that I know of, so its really impossible to state this fact. However, I wish you the best with your trade here. As I have said in a few other posts, 1.15 may be in the end of the slide and if it is, then good luck to you - I mean no malice, I wish you the best. It's just not the way I personally trade, but I say find whatever works for you - the market is more about you as person than about the market in general if you ask me.

By the way, great nickname!!!!

Cheers
Reece

 

[Kauri]

14 Feb...The volume over the past month coupled with the basing price action suggests steady accumalation to me, todays action although positive suggests that there are still sellers out there. The next few days will be interesting.

P.S... Red, I've dusted off the running shoes but haven't got down in the blocks for the 110mtr hurdles yet.

Am still watching with interest.. like to see this re-test of lows rejected strongly, there seems to be increased buying stopping it dropping the last 2 days... then hopefully a strong break through resistance... not asking for much I know...
P.S. There you go Red, I can see the hurdles already.

 

[rederob]

Am still watching with interest.. like to see this re-test of lows rejected strongly, there seems to be increased buying stopping it dropping the last 2 days... then hopefully a strong break through resistance... not asking for much I know...
P.S. There you go Red, I can see the hurdles already.

Kauri
C'mon - there's 3 cents of action to the downside to come before I get serious!
However, with the allords very high, and oil prices relatively firm-to-high, there should be cyclical twin-shifts downward ahead for us.
Accordingly, I have revised my present thinking and am punting for $1.05 entry price - perhaps late march?
Will keep reworking the numbersimp:

 

[Kauri]

Kauri
C'mon - there's 3 cents of action to the downside to come before I get serious!
However, with the allords very high, and oil prices relatively firm-to-high, there should be cyclical twin-shifts downward ahead for us.
Accordingly, I have revised my present thinking and am punting for $1.05 entry price - perhaps late march?
Will keep reworking the numbersimp:

Red,
Agree about the oil and xao this year, after all oil has put on about 20% recently and the xao about.. say 9% odd since the last blip? Unfortunately BPT has been out of cycle over the same time, so possibly it is being driven by other factors? IF oil and xao both do cycle lower and IF BPT suddenly decides to get in step it might get nasty. Just as numbers can be reworked, so hurdles can be shifted. Just so long as they are not shifted mid-race.

 

[Dr Doom]

I agree that there is concern if/when the cycles start to line up we could be in for a correction but until such time we can still speculate. I've noticed what looks like a 2 tier energy market evolving between stocks that have responded to the oil price strength & those that haven't, specifically -

BPT, ARQ, HZN, PSA, STU, & COE

What makes it interesting is todays ann by TAP about a possible future owner taking up a position on the share register. When compared to BPT which ones of the above look better potential takeover prospects? I've chosen the above as the share prices for all of them are showing a similar downward slope, so at some stage each will be fair value to someone, possibly another company.

 

[CanOz]

I agree that there is concern if/when the cycles start to line up we could be in for a correction but until such time we can still speculate. I've noticed what looks like a 2 tier energy market evolving between stocks that have responded to the oil price strength & those that haven't, specifically -

BPT, ARQ, HZN, PSA, STU, & COE

What makes it interesting is todays ann by TAP about a possible future owner taking up a position on the share register. When compared to BPT which ones of the above look better potential takeover prospects? I've chosen the above as the share prices for all of them are showing a similar downward slope, so at some stage each will be fair value to someone, possibly another company.

I like this......

 

[Freeballinginawetsuit]

IMHO today's announcement for BPT is a clear indication of their fundamentals that have been known for a considerable time.

BPT's been spanked hard on volume today and it is difficult to ascertain why posters wouldn't have accumalated over the last few days. Each to their own though

 

[Kauri]

IMHO today's announcement for BPT is a clear indication of their fundamentals that have been known for a considerable time.

BPT's been spanked hard on volume today and it is difficult to ascertain why posters wouldn't have accumalated over the last few days. Each to their own though

First hurdle jumped and 50% of position taken, will buy another 50% when next is achieved.

 

[TheRage]

Anyone know why volume is high on bpt today?

 

[rederob]

First hurdle jumped and 50% of position taken, will buy another 50% when next is achieved.

Got my second hurdle at $1.05
Last hurdle is to get in at $1 even but don't like my chances.
Methinks the bargain hunters are going to drive Beach north from here.