Hi Kenny!
You mean stocks are supposed to move up on news!?!? <VBG>
Based on prior patterns, I generally do not expect significant volume on news, unless its unexpected and out of the blue (you know - "...and oh, by the way, we found 2 bill. bbls of oil on the lower forty") <vbg>. The key with IPC seems to be longer term follow through. As example, I expected the new well test in Malaysia, Bunga Seroja 1, which has identified a whole new development area for them, to generate more excitement than it did. While the price toyed briefly with 5 1/8, it didn't sustain and we've had steady erosion until now. Yesterdays ask of 4 7/16 was kind of a low point. I can only speculate that the loss of cash flow several months ago when they sold the Oman concession has scared away the big money, and most are taking a wait and see attitude, not unlike the investors waiting for the Arakis pipeline to be on its way before anything happens there.
Well, the wait and see is now - spice is flowing. By all reasoning, establishing the production flow should allow potential investors to re-focus on positive, future exploration. The second Bunga Seroja well at the end of August should help to define the extent of the earlier discovery well in Malaysia, and thus provide a kick to reserves; and resumption of exploration in Libya sometime in the 4th quarter should also help momentum, although this is much more speculative in nature. Also, investors can now focus on Phase 2, where production is to be increased to 40,000 bpd and 250 mcfpd in late 1999. Tomas was wondering if this would have more immediate impact on the stock price, but I was of the opinion that the effect would be more gradual as announcements are made on progress. And don't forget the new Sudan concession, which has a great deal of potential early next year - that one is going to be exciting to watch.
But you weren't asking me that, you just want to know if the stock price is going to go up??? <bg> In the five years I've owned this stock, I've learned one important fact - the stock price is going to do whatever the hell it wants. Our little exercise earlier in the thread reviewing news/stock price action revealed several things - watch for spikes in volume over 60-80K, combined with sustained price moves. It's a forward indicator to news. If you want my gut feeling, I think we've seen the bottom of the current price trend, and if you wanted to take a position, this isn't a bad price to do it at. I would not expect a short term hellcat of a stock, though, IPC tends to move more sedately over a longer period of time. On the other hand, it did a nice run earlier this year to 6-1/4, on less news - could it do it again?? I'm not that good a prognosticator.
Sorry to ramble on, but sometimes these exercises help me to work through my own focus on the stock. You got a long answer to a very short question <g>.
Had a great trip, BTW. My wife showed me up and caught two nice rainbows - much better than freeze dried food!!
Alex |
