happyinvestor spreading the joy!9 Mar 2021 11:36
HappyInvestor100
Strong Buy
RE: TullowToday 11:29
I think BP is far, far better value especially after Tullow's recent excellent run. In terms of risk-reward, I don't think it is even close. Of course, one can own both but, at these relative prices, I would only buy BP.
With Tullow, I think there is a good chance that management will seek to raise fresh capital taking advantage of a stronger equity market for oil shares. They will look to get gearing down before refinancing and they would be daft not to take advantage of this opportunity. McDade, the previous CEO, neglected the crown jewels in Ghana assets and they require substantial capex to realise their full potential in the long run.
BP is, of course, a completely different animal yielding 5% with the promise of a higher payout to come. We're a lean, mean, cash-generating machine with so many levers to pull to add value. Can't see why I would buy Tullow over BP right now...
Best
Happy
Best
Happy