• 4 mintues Texas forced to have rolling brown outs. Not from downed power line , but because the wind energy turbines are frozen.
  • 7 minutes Forecasts for oil stocks.
  • 9 minutes Biden's $2 trillion Plan for Insfrastructure and Jobs
  • 13 minutes European gas market to 2040 according to Platts Analitics
  • 1 min Simple question: What is the expected impact in electricity Demand when EV deployment exceeds 10%
  • 3 hours America's pandemic dead deserve accountability after Birx disclosure
  • 2 hours Putin blocks Ukraine access to Black Sea after Joe blinks
  • 6 hours Today Biden calls for Summit with Putin. Will Joe apologize to Putin for calling him a "Killer" ?
  • 3 hours U.S. Presidential Elections Status - Electoral Votes
  • 1 day Fukushima
  • 2 days CO2 Mitigation on Earth and Magnesium Civilization on Mars – Just Add Water
  • 1 day Biden about to face first real test. Russia building up military on Ukraine border.
  • 4 days New Chinese Coal Plants Equal All those in U.S.A
Martin Tillier

Martin Tillier

More Info

An Unlikely Entry Point For Some Long Plays

Last week, as earnings season began, I suggested a few plays that, at the time looked a little risky. I mentioned four stocks as possibilities, Halcyon (HK), Exco (XCO), Continental (CLR) and Devon (DVN). The first two looked viable on the basis that all of the bad news about earnings was priced in, and the others were a play on the possibility of acquisition rumors. The takeover scenario hasn’t played out yet, but a reaction to slightly higher oil and some early “not as bad as it could have been” Q1 earnings in the energy sector have given all four a boost. They are all trading higher (between 3.5 and 13 percent higher) than Friday’s close.

So far, so good, but if those plays were a little too risky for your taste there may be a couple of trades in front of next week’s earnings releases that pose a little less risk. For that, rather than looking at extremely hard hit E&P companies, it may be better to look at oilfield services companies. They too have been under pressure as the E&P companies have shelved projects, but they have not hesitated to take action that has been welcomed by the market.

Big job cuts and other cost cutting measures have already been announced by almost all service companies. That may make it seem like a strange time to buy the stock going into earnings, but we are way past the point where shrinking capacity is a negative. For evidence, think about what happened to Schlumberger (SLB) stock on Thursday…




Oilprice - The No. 1 Source for Oil & Energy News