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Added to BAS, CCJ

I drained much of my remaining cash position, adding to BAS and CCJ.

I’m committed to a holiday rally. I have only a trace amount of cash left. I have not dipped into margin trading.

If a bottom doesn’t materialize within a week to a week and a half, I will reassess.

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BAS Kicking Me In The Mouth

And BAS is down another 5% today, perhaps as a product of follow through weakness in the sector, an announcement that they intend to raise $250 million, or it’s just leading the charge after Ben Bernanke’s…um…what the hell was the point of that speech anyway?

I don’t know; you pick the reason. None of them really makes sense.

After Key Energy’s disappointing guidance, the investing world is scared – scared, mind you – of any (already highly likely and anticipated) forward guidance that is anything less than what was expected at the beginning of 2012.

Of course, the entire energy sector sold off hard between then and now, rendering all the fracking companies dirt cheap. And secretly, we all know that natural gas / oil extraction in this country is going to continue to expand voraciously. And especially so just as soon as we get some more base demand online and some natural gas price stability. Which looking at coal miners crumpling, will be coming shortly.

Hell, we don’t even need demand for natural gas – just somewhere to put the God damned stuff would suffice…

But that’s all unimportant now. If BAS should print numbers that show a lower growth rate, even though we all know it’s probably just a lull, the market is preparing to give the stock a PE ratio that reflects the disappointment in its entirety.

This is a grave mispricing, in my mind. But hey, I’m happy to embrace and buy the plunge. Both Obama and Romney appear to be very accommodating to the drilling taking place in this country. And to me, energy services companies are still the best way to try and play a bottom in natural gas prices without actually getting beneath that falling piano.

Meanwhile, BAS persists in being one of the only energy services companies that actually has any cash on hand. They’re about to have $250 million more. If we get the slowdown everyone is bracing for, I can tell you without hesitation it will kill dozens of the weaker players. They have no cash on hand; no buffer to absorb shock.

With BAS, I’m looking ahead, to a time when natural gas production is expanding again, even slower than it was this past year; to when natural gas demand has grown on the backs of cheap volumes; and to where BAS is one of the only remaining players.

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Meanwhile, In SKUL…

Look, I don’t want to talk about today, and especially not BAS which is ground zero for this selloff.

I don’t see how revenue downgrades are news. BAS already said they expected revenues to contract by at least as much as the market seems to be fretting over. This was on the table months ago. You’re only just now realizing it if you’ve had your head up your ass.

I’d much rather focus on the promising move in SKUL, which is preparing for an EPIC short squeeze.

It’s Christmas time…

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Added To BAS – Energy Services Getting Dismantled

I’ve been watching my BAS position, along with the entire energy services sector, being thrown off a highrise all morning.

I don’t know why, but all of a sudden, economic contraction matters again. Let’s gloss over that the entire planet has been in an industrial contraction since mid-2010, uninterrupted, and that this is not news in the least.

Let’s ignore that demand for basic materials ranging from oil to metals has been channeling downward only sporadically delayed from momentary noise – for two straight years.

Let’s pretend we didn’t already know this was happening.

Because about a month ago, everything was fine. And now, right now, it matters. We just cannot go on.

“Did you know Italy’s economy contracted last quarter?”

Well gee, I could have guessed. Something about it also contracting every other quarter for the prior 8…

At any rate, BAS is being unfairly hit here. I’ve been through their books, and they’re trading reasonable. Even with broad slowdown, they’re basically in a position to absorb the shock. And they’re a survivor – I welcome industry consolidation because BAS will emerge the winner.

So I added to BAS for $11.31.

Cash stands at 10%

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Added to CCJ

I bought some more CCJ for $21.32, bringing my total cash position to 15%.

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Added to AEC

I added a few percent onto my AEC position for $14.84, bringing my cash inside of 20%.

At this stage, it’s a 5% dividend even without further appreciation. I’ve ranted enough about the treatment the stock has received over equity raises and cap-rates – the stock is cheap. I’ll spare you a 6 page diatribe.

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