Zeev et al,
I have held HEC shares since when it was trading in the 2's, and I certainly have no intention to sell - it would be silly to at this point. Look, it doesn't matter from where or how they get their funding; this stock is primarily an exploration play. I purchased it for the *potential* of benefiting from major discoveries in Columbia, and I believe most people who are long are in it primarily for that reason too. HEC has the second largest holding of any foreign exploratory firm and I'm sure the holdings were chosen with an eye for oil. If HEC doesn't score a major find, then its stock price will most likely drop (maybe to the 1's and 2's, where it has been before), as is true with any company of this nature, regardless of the terms of financing. On the flip side, if it hits big (as some of its neighbors have), then the stock will soar, regardless of financing. In the meantime, "well-meaning" people like Zeev may bring to question (again, again, and yet again) the wisdom of the company's financing decisions, predict the "inevitable death spiral" and such, but in my mind, it pretty much boils down to this:
if you are long: this is an exploration play. Period. If you bought the stock for another reason, then you bought it for the wrong reason. If you sell the stock for any reason other than the company not finding enough oil on their holdings (which we have no way of knowing one way or the other at the present time), you sold prematurely. If the company hits big, we will definately profit handsomely. If not, that is the risk we took when we put money in the stock in the first place. What the stock does between now and when the results are in for the final exploratory well in Columbia is inconsequential.
if you are short: keep trying to scare investors into selling - it's apparently working! If you can make money in the short term by doing so, go for it! There will probably not be a report out on any major exploratory wells for a few months at least, so you have plenty of time. But I'd suggest you cover before they announce, as I believe the risk for you there is greater than the possible reward (after all, if the stock goes down to 0, you only make 100%, whereas if it goes to 10+...)
if you are Zeev: you are the only here who knows what your true motivations are, and I will give you the benefit of the doubt and assume you don't hold a position in HEC and spend numerous hours posting on this thread for the sake of us poor misinformed investors long on HEC in the hopes that we will come to our senses and sell this dog of a stock. Well, listen carefully (if that is your true intention), because if you can prove that HEC has no chance of scoring a major find, then I'm with you--sell this dog! If not, then please don't try to sidetrack us anymore with talk of "floorless", "groundless", "roofless", or "*-less" financing. And I'll even give you as much credit as saying that I think you know exactly what you are doing here.
Sincerely,
David |
