LNC - Linc Energy

[basilio]

Much of the discussion re LINC on this Forum has covered
1) The innovative nature of the coal to fuel technology
2) The practical success of the trial technology
3) The wide ranging nature of the companies activities - international hookups in India, China, Vietnam, and USA
4) The pending sale of the Teresa coal tenements to Chinese interests for $1.5 billion. (Which is still not settled....)

IF, IF... these premises are accepted as valid then the current LINC price is cheap.

 

[Mickel]

Thanks ColB and Basilio.
While Peter Bond is confident the Teresa sale will be finalised with the Chinese, even if it isn't, the tenement is still very valuable. At a sale price of $1.5B it is worth approx $3.75 gross per share which makes the current price of $1.60 very cheap.

 

[glads262]

employee options?

Just posting an idea that it is possibly employee excised options that have recently been responsible for some of the selling on the market? These employee's would be sitting on very large gains which they have not previously had access to - and may be wanting to cash out. Hopefully over the next few days this possible selling pressure will ease?

This is a hypothesis only - please do your own research!

 

[Goldmann]

I'll try on Mickel's behalf Prawn.

LNC has in the past month been sold down to a low of $1.50 before closing above $1.60 on both occasions. It has 'HAD' strong support at that level.

Fundamentals aside, its closing price of $1.60 today could be attractive to even a technical trader.

A bad day tomorrow however may well test those lows.

Let's hope for a good day, we're due one!

whats more worrying is what will happen if LNC close at 1.50 or below... Oil price has rallied substantially in last few days from $34 odd $40+. LNC has been following oil - but not this time... people are loading up to get rid of this one... the employee options may be one plausible reason...

just my opinion.. i hold (still with the long term in mind)...

 

[Glen48]

Latest opinion is OIL will go as low as $17 a B.?????
still won't make any difference to our costs we all know how will protected we are from getting dudded.

 

[The Dealer]

The BBY analysts have a SP of 2c if oil is at $35. It's a reflection of the balance sheet as is right now.
I would think the dive in the SP is all connected to the unwinding of hedge funds and margin calls. People are pulling from hedge funds and they have to sell out. The hedge funds don't want to, but have no choice when a redemption form shows up.
Also, with big pull backs in resources and banks yesterday, people are getting MC and have to sell even though they don't want to either. Worse, is that some margin lenders continually reduce the LVR on certain shares which is causing more margin calls.
Not sure on this, but I think LNC has dropped out of top 200 so index funds would also be eliminating their positions.
I bought at $1.89 months ago and sold this one out after it got $5 and thought I was out too early. But I have just started to come back in and will average in over the next couple of months. I'm sure others will think $1.60 is better than $5 too and do the same.

 

[The Dealer]

Latest opinion is OIL will go as low as $17 a B.?????
still won't make any difference to our costs we all know how will protected we are from getting dudded.

Here is a analyst report for QAN on fuel prices.
Don't think $17 this year will matter when LNC wont be producing till 2010.
Event

With Macquarie Research updating our oil price and economic expectations, we have taken the opportunity to revise our fuel bill estimates for the Australian airlines.

We have also revised our yield and load factor assumptions in light of ongoing weak demand and a challenging pricing environment.

Impact

financial year 2009 promises to be a tale of two halves, with record fuel bills expected for VBA and QAN in first half 2009, although this is expected to do an about-turn in second half 2009 with jet fuel at multi-year lows. We do, however, expect oil prices to return to ~US$70 per barrel levels by financial year 2010, providing only short-term relief to the airlines from a cost perspective.

QAN's more effective fuel hedging structure allows it to participate significantly in falling oil prices, unlike VBA, who's economic gains are likely to be capped at US$80 per barrel due to the use of a collar strategy. It remains to be seen whether QAN will look to press home this advantage through more aggressive pricing, or pass these savings onto shareholders by protecting earnings - we expect the latter.

Ongoing capacity rationalisation from both carriers will be key to preserving operating margins in a lower demand environment. Load factors for the remainder of the year are expected to remain relatively stable, with second half 2009 seeing significant capacity reductions from QAN in particular. financial year 2010 earnings are likely to remain under pressure should demand not improve along with our expected increase in fuel prices.

 

[ColB]

Originally posted by Glen48:

"Latest opinion is OIL will go as low as $17 a B.?????..."

Whose opinion is that Glen? Yours? Or that female analyst, Crystal Ball.

Would be nice to see your source quoted so readers can make some assessment of its credibility.

 

[Glen48]

Sorry I read it in a report some where if I find it I will post it.
I appears there are ship all around the World full of Oil and it is not viable to send then to ports to unload.
The $17.00 they claim is an over shoot.

 

[Glen48]

From Money & Markets:
I told you how 25 oil tankers had been turned into floating storage containers holding 50 million barrels of oil. Well, now the amount of oil stored on tankers has risen to a staggering 80 million barrels!
If oil closes below $33, I think it could go to $25. And if oil gets to $25, sheer momentum could carry it to $20. And if it gets to $20, then it could even test its long-term support ”” just above $17 ”” before finding a bottom.

 

[Goldmann]

Sorry I read it in a report some where if I find it I will post it.
I appears there are ship all around the World full of Oil and it is not viable to send then to ports to unload.
The $17.00 they claim is an over shoot.

Im not sure you read the bloomberg report??? i would like to see where it says its not viable to send oil to ports to unload at $35 a barrel????

heres another theory around why this oil is sitting in tankers off shore.

"--This brings us to the third reason oil prices should rise later this year: the oil trade is back on. Sure, credit may still be a scarce commodity. But if you judge traders by their actions, you can see the market is setting up for a big oil back draft. As evidence, Bloomberg reports that, "Morgan Stanley hired a super tanker to store crude oil in the Gulf of Mexico, joining Citigroup Inc. and Royal Dutch Shell Plc in trying to profit from higher prices later in the year, two shipbrokers said."

--Our friend Dan Amoss back in America calls this the oil arbitrage trade, where supply is stockpiled offshore, and thus withheld from refiners, allowing existing gasoline inventories to be worked down. Then in six to twelve months time, when crude prices have moved higher, you simply park your ship at the terminal and cash in on the difference between what you paid six months ago (today) and the new market price.

--It is normal for the oil futures to be in contango, where spot prices are lower than futures prices. What's less normal is the amount of oil being stockpiled offshore. "Frontline Ltd., the world's biggest owner of supertankers, said Jan. 14 about 80 million barrels of crude oil are being stored in tankers, the most in 20 years," Bloomberg ads. "

 

[cwamit]

one has to wonder if enough shipping is used up for storage that might influence in itself for the price of oil to go up, far too big scale for my small brain to comprehend if thats possible... cant cost oil tankers much just to sit and hold oil compared to transporting the stuff, got to be a few quid in it for the shipping company, maybe less seamen are needed (reminds me of a whale joke).

 

[kitehigh]

Pretty heavy sell off today down 14.4% to 1.335 on almost double the average daily volume.
There may be good long term reasons to hold this stock but currently the chart is looking very sick. Doesn't help either with the price of crude in the low 40's.

I will continue to sit on the side lines but keep a close on this stock for a entry position.

 

[Mickel]

.......
Not sure on this, but I think LNC has dropped out of top 200 so index funds would also be eliminating their positions.
I bought at $1.89 months ago and sold this one out after it got $5 and thought I was out too early. But I have just started to come back in and will average in over the next couple of months. I'm sure others will think $1.60 is better than $5 too and do the same.

LNC has not been dropped from the S&P/ASX200 index.

Reference is
http://www2.standardandpoors.com/spf/pdf/index/20081205IN_QrtlyRebal.pdf

 

[xscape]

Sold my holdings this morning with the intention to rebuy shortly thereafter at a lower price. LNC now placed in pre-open. I hope it is good news as I got back in just seconds beforehand.

 

[Miner]

Sold my holdings this morning with the intention to rebuy shortly thereafter at a lower price. LNC now placed in pre-open. I hope it is good news as I got back in just seconds beforehand.

You may be lucky to get escaped Xscape.

LNC got a big fall and as previously I raised questions on their acquisition value on American gas company (posted in this forum before)

The technology has definitely an excellent merit and going to be the call of the next decade as an emerging technology.

My observation is LNC however is a bit market saavy like FMG - provides lot of hopes with not comparative bone to support them.

Attached price query from ASX

Disclaimer : I do not hold LNC but learning fast on CTG technology and about LNC as well

 

[Goldmann]

Pretty heavy sell off today down 14.4% to 1.335 on almost double the average daily volume.
There may be good long term reasons to hold this stock but currently the chart is looking very sick. Doesn't help either with the price of crude in the low 40's.

I will continue to sit on the side lines but keep a close on this stock for a entry position.

wish i was on the sidelines, this ship appears to be sinking fast and you would have to question now whether or not this chinese deal will go through - the market obviously has it doubts...

 

[kitehigh]

LNC is getting mauled again today currently down 12.5% on strong volume, while the rest of the market is having a up day. I read their standard to reply to the asx inquiry but ain't convinced by it. Some information must be leaking out and causing the run for the exit doors. Looks like I will continue staying on the side lines. There doesn't seem to be any hurry to jump into this sinking ship.

 

[glads262]

Some thoughts on todays action.
Braking ticket issued - Peter mentions short sellers.
Huge number of sell orders then placed, and corresponding buy orders began popping up under the share price. I think there was some shorting today!!

Does anyone know an easy way of checking the current short position on a stock??

 

[The Dealer]

Some thoughts on todays action.
Braking ticket issued - Peter mentions short sellers.
Huge number of sell orders then placed, and corresponding buy orders began popping up under the share price. I think there was some shorting today!!

Does anyone know an easy way of checking the current short position on a stock??

http://www.asx.com.au/data/shortsell.txt

This is on the ASX website and shows the day before shorted stocks, how much stock was shorted and the % drop.
Link is being shorted big style! Has been for weeks.