Any idea on why GW was left out of the following positive opinion of land drillers?
PENgr:
Since my 2/5/98 post, the group has been underperforming
the market. The poor performance is due to the drop in
oil prices.
I think that the strength in natural gas prices, inspite of this
very warm winter, reflects some VERY strong underlying fundamentals.
The price strength and storage volumes (just slightly above last yrs.
figures) are indicative of Supply/Demand balance. Should El Nino's
warming carry into the summer---we could have an abnormally Hot
summer!! If so, look for gas prices to be unseasonably high!!!!
This will restore the confidence to drill aggressively for winter sells!!!
Additionally, historically, abnormally Cold winters follow El Nino events!!!!!
If so, we have the recipe for Shortages!!!!!
I think that NE, RIG, RDC, DO, ESV are excellent buys at this point.
I think that the correction bottoms (from Leg Two peaks) were made
in early January and that we are in the early phases of Leg Three.
I am also starting to nibble at the Land contractors. I think that
UTI, BDI, PTEN and NBR are very close to their ultimate correction
lows at this point. They represent excellent value plays at these
prices----relative to replacement costs. If natural gas continues to
show strength, we will see the land drillers stocks much higher
than todays prices.
All IMHO!!!
P Engr.>>>>> |
