Good online meeting today, thanks
Do you have any comments on the performance of the microcap energy stocks versus the larger stocks?
Someone posted an article on this on this board a day or so ago and the chart is stunning.
Will microcap energy stocks 'catch up' in your opinion, stuff like GST and EPM, performance wise?
Chat with Dan
Re: Chat with Dan
I thought the Live Chat went well until we just lost the sound for no reason. The replay will be up on the website soon. Right in the middle the sound goes off for about five minutes but it does come back and you don't miss anything.
Small-Caps vs Mid-Caps:
In general, the small companies (especially E&P companies) have a lot more risk than the larger companies like our Sweet 16. One bad well can really cause them problems. However, the opposite is also true. One really good well can send the stock up rapidly.
Oil & Gas is a very capital intensive business. Small-Caps have less access to capital. They often have to go to the equity markets to grow (i.e. - FANG) and investors don't seem to like that dilution. Or they leverage up with a lot of debt.
Our Small-Cap Growth Portfolio is a rather diverse group. CRZO and GTE are now over $1Billion market cap, so you can't really compare them to micro-caps like OEDV or even GST.
CRZO and GTE are probably going back to the Sweet 16
TGA is a good example of one that really paid off for us. We picked it up at $0.33/share and it ran up to over $10/share when they started stacking up quarter after quarter of production growth.
I mentioned GST on today's call. If they close their East Texas sale to Cubic and report better oil wells in Oklahoma the stock could take off. If at the same time Ngas prices improve, it could be a "rocket". If they don't close the sale and have disappointing results in OK then the share price could tank. BTW I expect the "good case" to happen.
> EPM looks like a sure thing. Delhi Field will eventually reach Payout.
> CRK and SFY need continued success in the Eagle Ford and $4 Ngas
> TGA needs things to settle down just a bit in Egypt, operations are rock solid.
> TPLM should have a good fiscal quarter that ended 7/31. We'll find out in a couple weeks.
Small-Caps vs Mid-Caps:
In general, the small companies (especially E&P companies) have a lot more risk than the larger companies like our Sweet 16. One bad well can really cause them problems. However, the opposite is also true. One really good well can send the stock up rapidly.
Oil & Gas is a very capital intensive business. Small-Caps have less access to capital. They often have to go to the equity markets to grow (i.e. - FANG) and investors don't seem to like that dilution. Or they leverage up with a lot of debt.
Our Small-Cap Growth Portfolio is a rather diverse group. CRZO and GTE are now over $1Billion market cap, so you can't really compare them to micro-caps like OEDV or even GST.
CRZO and GTE are probably going back to the Sweet 16
TGA is a good example of one that really paid off for us. We picked it up at $0.33/share and it ran up to over $10/share when they started stacking up quarter after quarter of production growth.
I mentioned GST on today's call. If they close their East Texas sale to Cubic and report better oil wells in Oklahoma the stock could take off. If at the same time Ngas prices improve, it could be a "rocket". If they don't close the sale and have disappointing results in OK then the share price could tank. BTW I expect the "good case" to happen.
> EPM looks like a sure thing. Delhi Field will eventually reach Payout.
> CRK and SFY need continued success in the Eagle Ford and $4 Ngas
> TGA needs things to settle down just a bit in Egypt, operations are rock solid.
> TPLM should have a good fiscal quarter that ended 7/31. We'll find out in a couple weeks.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
-
wilmawatts
- Posts: 685
- Joined: Fri Apr 01, 2011 10:12 am
Re: Chat with Dan
Thanks Dan
Syria back in the news this afternoon, Should be a volatile you weeks as Congress debates the Syria intervention issue
Syria back in the news this afternoon, Should be a volatile you weeks as Congress debates the Syria intervention issue