I agree that looking to NSS and LSS indicates that MAVK seems to just be in the wrong part of oil-svcs right now. So everyone long needs to ask themselves this question:
1) Do they believe that this segment is an essential part of oil services that isn't going to get defined away by new tech or new business models?
2) Do they believe this sector will recover in the next 2-3 years?
3) Do they believe that Maverick is doing as good or better job competing with other companies in this segment of the oil-services sector?
Right now, I believe all three, especially seeing NSS and LSS. As a result, I am inclined to hold through this period, possibly adding to the position down the road when stabilizes and earnings pick up (likely in a couple quarters).
I also believe that IR is not blowing smoke about some analysts not being in contact with them. There is no way looking at NSS and LSS's numbers that anyone could have thought that MAVK would somehow earn $0.25 this past quarter. A good analyst would be tracking internally all three.
I suspect that the low analyst is the one in contact. Now, at $0.95 for 1999, MAVK may not seem like a super buy compared to $0.90 for 1998, but look at the quarter to quarter growth that must be predicting. They must be assuming something like $0.08 for Q4 98, $0.10 for Q1, $0.18 for Q2, $0.28 for Q3, $0.40 for Q4 or something like that in order to get $0.95 for 1999. Granted they could just be rounding numbers, or expecting a spike in Q2 or something, but the point is this and Q4 looks like the expected nadir of earnings for the next 6 quarters.
As such, if you are the type that tries to jump in and out of stocks every couple of months, maybe there is no reason to hang out with MAVK through Q4. Personally, I don't try to time things like that, so I'll just be holding until I get evidence that one of the above 3 questions is a No.
- Adam |
