Seismic:
Ron; I like PGO about as much as any company in the entire Oilpatch. Especially when measured on a risk vs.reward basis. They are selling at a cash flow multiple lower than virtually any other Oilpatch company ( 1/3rd of HAL's, 1/4 of SLB, 1/2 of GLBL) - this and their balance sheet, the move to FPSO business, new ultra high tech Deep Water vessels - and I see PGO potentially at $30 by Xmas, $48 end of 2000 and a $60 stock if the longterm Oil Bull run holds in 2001.
VTS is the smart way imho; to play the ''land drilling'' recovery. Very, very leveraged to any increases in Nat Gas Land Drilling and also Globally diversified. I'd rather own VTS here today, than PTEN, or UTI at these prices - for a land drilling play. (actually I'd rather own the actual Nat Gas E&P's than VTS here ...vbg).
OMNI - was a no brainer in the $3's - now at high $5's to $6 - I'd rather wait for fundamentals & the transition zone to pick up activity-wise. It's not a bad buy & hold play here, but could re-trace 20% real easy.... I prefer to catch OMNI when the recovery looks more certain - I'll give up the $5-7 move here - and jump on for the $8-15 run when things are more certain recovery-wise. I really like this little company though.
Just quit following MIND, IO looks cheap, again I just prefer to cover the entire ''seismic'' play with just PGO & VTS. Same for EGEO, VTS & PGO just do everything better...with much, much less risk (better balance sheets, more diversified, higher tech oriented etc.) !
VTS was a mo-mo fav' in 1997-8 as well...the Street will put the wind at its back when things start cookin again...
PS re: Oil Prices
Anyone else thinking that we retrace to $16, maybe touch the mid $15's, one more time ( in the next 2-3 months?) before building a solid (sustainable) run through $18-19 this fall/winter ?
This is the reason for my ''short'' plays - I do NOT see any scenario possible to where we just move from OSX 45 to 100-120 without another 30-40% retracement of the move (ie: 15-18 points off of a 45 to 85 run). The same for Crude Prices. Just do not see a run from $9 to $18, then to $20+ without a retracement back to $15/16.
It is that retracement in crude that will trigger an OSX correction. We've allways had them (retracements) and I think we will again. It will happen when most don't expect it and will be profit taking oriented selling vs. the gloom & doom selling of the recent past. |
