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Showing posts from September, 2014

Stock Analysis: Encana (ECA)

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ENotes:
Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning.
Today Encana announced the acquisition of Athalon Energy.  Athalon is a relatively new energy company that was spun out from a private equity fund around a year ago.  It contains around 140,000 acres of land in the Permian Basin in Texas.  This is considered to be some prime land that was acquired, similarly to Encana's last purchase of poperty from Freeport McMoran.  Analyst response to today's purchase has been positive.  It puts the company well ahead of it's goals regarding how much oil/nat gas liquids they'll produce by 2016 - so much so that they'll reach their goal a year early.  The deal is expected to close at the end of 2014, so it should…

Weekly Portfolio Summary

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Rough week for stocks as a lack of significant earnings related news combined with continued news about the Fed quickly raising rates, the Russia-Ukraine conflict, and how the Alibaba IPO was a sign of a top in the market ran non-stop.  Overall, stocks were beat down with a reckless abandon, no matter the story or sector.  Honestly, I expect another week of that next week, unless some sort of big news story hits to take away one of these factors.  All in all, my guess is that we see the markets pull back a good 5% from the recent highs.  Despite all the doom and gloom we're hearing, the S&P 500 is about 2% off of its highs.  The first big news that could impact stocks is coming on Friday, then the following Wednesday is when the next round of earnings seasons kicks off to bring real news regarding company's future outlooks.  Don't get me wrong, the outcomes on the recent quarter will matter, but in reality, it's the outlooks that will determine where stocks go from…

Weekly Portfolio Summary

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"The Lord giveth and the Lord taketh away."  That would be my theme on the week as the major story for my portfolio is the fact that all of my gains last week in NPS Pharmaceuticals was completely wiped out this week.  Additionally, I added to my position of Ensco PLC, however, I did it too soon and too aggressively.  Finally, the news from Home Depot continues to flow forward.  Around 56 million credit cards were impacted by their data breach, which they now say has been corrected.  While they announced this, they also felt comfortable enough with September sales to increase guidance yet again.  To me, this just proves that this stock will be nothing like Target was, even though the breach was larger.  Management's ability to protect, act swiftly, and provide the right kinds of assistance to those impacted will really help set the tone going forward.

On the week ahead, we're in a period of time that's generally empty.  None of my stocks has any scheduled events t…

Trade: Ensco PLC (ESV)

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Notes:
Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning.
Today I bought more shares of Ensco at $45.43.  The stock has continued to drop due to falling oil prices and lack of favor with deep water drillers as a whole.  The stock now yields over 6.5%, but I will admit I bought more too soon, especially since the stock dropped to almost $44.50 during the day.  I don't expect to make any further shares without first raising cash as well as the stock getting closer to a 7%+ yield.

Weekly Portfolio Summary

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It was a week where I crushed the performance of the S&P 500, however, I'm still way behind on a YTD basis.  I sold almost half of my position of Encana, stating it's had a big run, Oil and Gas commodities are under pressure due to both a stronger dollar (short-term impact) and a couple reports coming out with higher than expected reserves.  With the proceeds, I shifted to a deep water driller in Ensco PLC.  While the same risks/impacts are in place, we see more safety to the downside here as the stock barely moved down despite comments out of both Seadrill and Transocean talking about headwinds their companies are facing.  The balance sheet is strong, they're mostly completed on life cycling their rigs, as it's the second youngest fleet in the industry, and the stock has an over 6% yield while trading around 8 times 2014 estimates.  The worst seems to be priced in and while I can't say I see the stock launching under current circumstances, it's not badly p…

Trade: Ensco (ESV)

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Notes:
Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning.
Today I bought some shares of Ensco at $47.60, as I've indicated I may do to maintain an energy position.  This is slightly higher than the $47 target I was aiming for, but the stock was jumping and with yesterday's Presidential announcement to perform air strikes on ISIS militants in the Middle East, it's possible oil will rebound for a few days.  My target is to have a cost basis below $50.  As I stated in my previous analysis, this stock is below 9 times this year's earnings estimates.  Current predictions are actually for earnings to decrease over the next couple years, which is a worry and risk.  I saw recently how this can affect stock price.  As …

Trade: Encana (ECA)

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Notes:
Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning.
Today I sold a little more than half of my position in Encana at $23.06.  After getting a decent pop on news that the company is selling off the remainder of it's position of PrairieSky, which was partially spun-out assets formed as a MLP in pipeline that Encana once owned.  This position raises cash for the company and certainly helps bolster their balance sheet.  My guess is they're preparing for a new land purchase similar to what they did earlier in the year by purchasing Eagle Ford shale assets.  Despite the upside potential to my guess, I've decided I need to sell a portion of my position at these levels.  I've chosen this for a few reasons.  Firs…

Weekly Portfolio Summary

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Took a week off on the summary.  Back to school now means back to action here too.  After what was felt to be a disappointing jobs report today, the market didn't really respond as expected.  It would seem Wall Street doesn't agree with the results and it's common that August is a relatively inaccurate month, I guess.  This isn't my knowledge, just some speak I've heard today.  All in all, even if one month is slower than expected, I don't think we see any signs of a slowdown in the economy - especially based upon the earnings reports of many of the companies I hold in this portfolio.  For this reason, I don't sense a need to panic right now.

As for my stocks, it was a little bit of a rough week.  Home Depot announced a potential security breach that could lead to millions of customers having some of their data lost to "bad guys" - whomever they may be.  I'll speak more to this on the stock's summary.  Additionally, NPS Pharmaceuticals took…