I sold out of my GMXR at the lows because of my over weight exposure to natural gas. It happens. I will not lament over it. Right now, I own FTK, SD and ATPG, making up more than 15% of assets. However, if Obama is really serious about turning the corner on oil, using the BP spill as a motivating catalyst, we will see much, much higher natural gas prices and equity valuations.
The following names attribute more than 75% of their production to natural gas. (hat tip to Po Pimp from The PPT, for this research)
CRK, MMR, PVA, ROSE, DPTR, PQ, GDP, CRZO, KWK, FST, COG, XCO, HK, NFX, UPL, RRC, STR.
Additionally, here are some other names to keep on the radar:
CLNE (natty gas stations), WPRT, NGS, BEXP, TLM, XTEC, NBL, SWN, KWK, PETD, PSE, KOG, REXX, HP, VNR, HERO, BRNC and of course FTK.
Over the next several days, I will weed out this list and select my favorites for purchase, providing the market keeps the uptrend intact.
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http://tiny.cc/61q2f USA real unemployment rate on par with the worst of Europe.
Fed is bluffing–no rate raises until late 2011. Timmy and Ben are going to Zirp this market to 15k.
By the way, the euro is still the most crowded short trade in the history of commitment of trader reports. Iran’s bullish position on the dollar is the final straw.
http://www.youtube.com/watch?v=sm8txY989Iw
Panama Orange: how does 17.5% “real” unemployment help your bull case to 15K? With the Euro tanking, how are you going to get your bull on?
The Fly is God.
the euro isn’t tanking, its forming a “septuple bottom” on hourly charts. The number 7 is critical for many reasons
The most important being, this (7) septuple bottom is forming into the bildeberg meeting. This is a planned occult symbol
Its all lining up now.
http://towerweb.net/alt-lib/seven.shtml
LMAO. This is hilarious. At least you have original reasoning.
I’ll definitely give you points for using mysticism to make your investment decisions.
15K on the Dow, here we come!
Too funny.
Due to my magnanimity, I should host Bilderberg II.
Rather than don black robes, hold hands, and chant around an oversized burning wooden owl, I recommend renting a miami beach conference room for fifteen minutes and adjourn.
Bilderberg is so outdated. Venetian Black Nobility, my friend. That is where you want to be. “Black” referring to underhanded methods with the goal of accumulating wealth and power.
Did you know that the Prince of the Netherlands was born into a blood line that allows him to veto the Vatican’s choice of Pope? Did you know he is also a former Nazi? He also started the Bilderberg group.
We live in very screwed up times.Where is Jesus when you need him?
I’ve never really ranked the netherlands with the oppressive police state that other countries have become.
What “other countries” do you consider to have become oppressive police states?
The longer the unemployment lasts, the longer rates will stay low, the longer the liquidity conveyor belt stays on.
EOG Resources [EOG] + Eagleford Shale = winship.
On May 26, 2010, a Colorado lawmaker removed the fracing amendment to the Water Bill. This was all about drillers disclosing hydraulic fracturing liquids that could be potentially harmful to the water table. With this off the table it should allow the hugely popular Marcellus Shale region to start to come online without impending regulation. Proven massive supplies should ensure future cash flows for quite some time.
Which of the drillers is running the highest margins now?
Hmm – Isn’t the mess we’re in now the result of a badly regulated industry, which then allows political chicanery when something goes wrong? I would much rather have a well regulated (not overregulated — well regulated) industry that adequately protects the other sectors of the economy that depend on the same resources being utilized by the O&G industries.
I understand that there are trade secrets involved in the fluids used, but there must be ways that these can be protected along with the water supply, which is also a scarce resource. Can you imagine the uproar if a major aquifer were polluted with some drilling fluid, and was unusable for untold years, or uncleanable? They would all have us riding bicycles and horses (not that there’s anything wrong with that). Flame away 🙂
You’ve struck on the core of the issue. Regulatory policies, before the deregulation movement in banking and industry, were constructed to provide barriers against situation that were unacceptable to a successful nation in general (i.e. the U.S.).
Aha! I figured something was up when I read that Shell paid $4.7 billion for 650,000 acres of Marcellus leases.
hey fly thanks for the update. you should check out FCG for a natgas play…. top 10 holdings –
Mariner Energy Inc. 4.98
Cimarex Energy Co. 4.63
Pioneer Natural Resources Company 4.58
EOG Resources, Inc. 4.05
Ultra Petroleum Corp. 3.78
Questar Corporation 3.77
EnCana Corp. 3.58
Forest Oil Corporation 3.50
Newfield Exploration Company 3.44
Range Resources Corporation 3.43
STAY AWAY FROM UNG!!
not like u care or anything about advice but … !!!
Look at FSNCX, SSGRX too
Fidelity Select NG Holdings: http://moneycentral.msn.com/investor/partsub/funds/holdings.asp?Funds=1&Symbol=FSNGX
Blackrock Energy & Resources Holdings: http://moneycentral.msn.com/investor/partsub/funds/holdings.asp?symbol=ssgrx&Funds=1
YADB
ITOTKO
panamadumbassorange – enough! give up! go volunteer cleaning up BP’s mess.
I am gonna sleep like a baby tonight since i bought those puts. Let the fucking bottom drop out i don’t even care.
No bottoms are dropping out. Hats are flying off, instead.
Monsieur Fly, you may wish to add ECA to this list. Since Encana split corporately and vested its oil work in Cenovus, it is a pure play on natural gas.
Kramerica Industries is prepared to assist in the oil cleanup. We have previous experience having designed a bladder system for tankers to put an end to maritime oil spills. I am just waiting for Obama and BP to contact my assistant Darin for the specifics. And if anybody wants to invest in my combination ketchup-mustard bottle business let Darin know.
Heh.
UNT
Well managed land driller and mid-stream nat gas processing and distribution.
Note: I’m not long nat gas because I think Obama is serious.
Is Obama serious about anything he says?
Only if there’s a constituency screaming in his ear. Nat gas doesn’t yet one – just TBoone.
PKD mothalicka what will dipstick the market and roll the F out
qwolla
PKD is building drill rigs in the Pacific NW for Alaska. BP is their customer. I met a bunch of their guys, all from Texas and Louisiana. Some of them headed up to “the slope” for the summer. They are a bunch of can do and get it done people. But I gotta think BP may have to bail on some of their Alaska shit.
We’ve got tons of idled natty gas wells all over the place in Alabama, especially along coal seams. There was a huge number of wells drilled 20 years ago. They ran them for about 5 years and they haven’t pumped since. If I see any doing their queer dance again, I might buy some natty gas stocks.
“Oil is for Asshats”
———Broker A -2007
Thanks good info
Added KWK today … Horn River & Barnett Shale seems to be lagging the group due to GS downgrade on Tues (Costanza Play with huge volume today)
My top four (RRC, UPL, ECA & SWN) sporting nice erections over the last couple of days … take profits and reload lower!
TLM is interesting … Montney & Utica (Gas) in Cd, Eagle Ford (Oil) & Marcellus (Gas) in US, North Sea, Europe and SE Asia
ROSE … Eagle Ford (Oil), Alberta Basin Bakken (Oil), Rockies (Gas) and GOM (Gas)
HK …. Eagle Ford (Oil), Haynesville (Gas), Bossier (Gas) & Fayetteville (Gas)
CRZO … Barnett/Woodford (Gas), Marcellus (Gas), Niobrara in Rockies (Oil) and Eagle Ford (Oil) as well as North Sea & TX/LA Onshore (Gas)
GDP … Eagle Ford (Oil) and Haynesville (Gas)
FST … Texas Panhandle, the Haynesville / Bossier Shale, and the Deep Basin Nikanassin Play in Cd
XCO … Marcellus (Gas), Haynesville (Gas), Anadarko Basin (Gas), Permian Basin (Gas) and the Rockies (Gas)
COG … Marcellus (Gas), Rockies (Gas), Anadarko (Gas), Haynesville (Gas) and Eagle Ford (Oil)
STR …Wait for the spinoff of QEP Resources Inc. in a few months for some of the most significant resource plays in North America, including the Pinedale Anticline in Wyoming, the Haynesville Shale play in northwest Louisiana, the Bakken play in North Dakota, the Granite Wash play in the Texas Panhandle and the Woodford Shale play in western Oklahoma …. all Gas save for the Bakken Oil
Deep water drilling restrictions as a result of GOM have prompted companies to get active in North American shale in a hurry to replace lost production … see Shell Oil story below:
http://blogs.forbes.com/energysource/2010/05/28/shell-brushes-off-alaska-block-with-5b-marcellus-buy/?partner=yahootix
[16] For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.
[17] For God sent not his Son into the world to condemn the world; but that the world through him might be saved.
Another name for you if you’re interested in nat gas exposure and want some yield is the royalty trust TIRTZ, which gets about 85% of its royalty income from nat gas.
Of the aforementioned companies by Po Pimp, I like FST the best from a pure valuation standpoint. Their ttm had profit margins of 45%, operating margins of 42% with a ROE of 42% which is tops among the list I narrowed down. They also generate a high amount of operating cash flow and are located in Colorado, where the representative withdrew their frac part of the water bill. They have moderate earnings coverage at 20 analysts, a short % of float at 7.7%, and generate 7.3 revenue/share which is double or 50% more than the others I had shortlisted. PVA is also interesting as it’s the only one trading near book, has a high short % (15) but lags in ROE and margins.
I would think that the ones that have been generating fat margins will only expand as natural gas prices increase. An added note is that weather analysts have been forecasting the coming hurricane season “hyperactive.”
I humbly submit APC.
Considering they could be on the hook for 25% of the GOM clean-up costs, you might want to stay away.
Saw your post in the PG and see your point. But based on what they published in their recent 10-Q I don’t think anyone knows for sure how APC is going to be impacted. Unfortunately I think short-term they get hit whether it’s justified or not. But long-term if they are indeed not liable then APC should BTFO.
how much will oil drilling restrictions in the gulf contract global oil supply? Natty G seems to fool people very, very often. Also consider that many of the companies you listed are investing in massive natural gas findings in the ohio river valley. supply fights high prices.
Natty related:
http://www.surfline.com/forecast/atlantic-hurricane-season_44001/
“Does this mean we are in for an epic season? No one can know for sure – that prediction is completely impossible. But we can see that our chances for a busier than normal season are quite high and thus we are certainly expecting a busier season than 2009. Further, given that we remain in the warm phase of the AMO, we think this season will be a bit busier than the long term average and especially so if La Niña develops in the eastern Pacific by August”.
How about an Nat Gas ETF? Im a non-committal puss like that.
FCG, UNG???
I’ll have you know that today, I bought NVLS in size. This company is trading at a forward PE of 5.5x earnings, not including the $6/share cash on the balance sheet. Feel free to join me in this profitable endeavor.
Based on today’s action, the weakening Yen, and the economic numbers this week, get ready to rally. It appears that things are about to turn up (before turning down again, at some point in the future, no?)
You bears, prepare to be publicly scourged, Ducati-style.
If, in fact, things turn out to be the exact opposite, I shall keel haul my chartist/market slave beneath my 65′ yacht—–for s & g’s, of course—thus deriving some sense of sadistic satisfaction from my market losses.
However, because he fears for his life, I am fairly certain my initial assessment is correct, thus adding to my “heap”.
Another angle is nat gas infrastructure:
http://www.ingaa.org/cms/31/7306/7828/9224.aspx
We have lots of the gas, but if we are serious about bringing it to the consumer, we have huge infrastructure upgrades and construction that is necessary.
It’s worth looking at HK, ENB, EPD, TRP and FLR.
EPD Chairman has been collecting shares in the $33 plus range within the last 2 months. Stock just broke the downtrend today and closed at $34 and change on shitty volume. There is no short interest to speak of. Only 30% float held by Institutions and Mutual Funds, while insiders still control 30% – for a company with a 21B market cap. Long term debt is in line with industry average. A 7% divy and revenues grew 134% last Q, while Net Income rose 78% and EPS 36% during the same period. ROE and gross profit margin sucks and the stock has risen 78% over the past year; however, insider buys have occurred over the past couple of months in the 33ish range. The company is expecting revs to increase 29% this year and EPS to increase 12% to 1.96. Using an industry average PE of 23ish, that would put the price at the 44ish level, which is a 29% increase from today’s close. This would be an all time high for EPD. PPT has Fundies and Technicals at the 4 level.
I like New Yawk in June, howabout you?
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Well thank god i hedged all my equity positions.