Member Info for Boyobach

Ocelot: Re the word "loyal": Karamehmet was one of the founders of Genel Enerji, his daughter remains on the Board.....

You gotta keep an eye on things when you're that committed financially. Loyalty doesn't have a price - - does it?

Ha - it's just semantics. Basically we are pretty sure they won't sell low without a fight. ATB.

Here’s a comparison of how G’s sp has fared v PoO, an Oil Major and a fellow KRI producer so far this month.

https://invst.ly/8-ddp

For those who are mystified at the way G goes up or down in response to factors that are general, specific to the industry, specific to the region or specific to the company itself, this chart should help to separate out those rises and falls, leaving the changes that are company specific a little more apparent.

This week G’s fall seems to be general + linked to PoO but with the two smaller KRI producers hit disproportionately but similarly. I can’t detect an obviously ‘G specific’ factor - contra views welcome on that please. My suspicion is that an underlying factor - eg PoO - will trigger a shift but the magnitude is then a matter of sentiment rather than calibration.

Note: prices zeroed at closing prices on the last trading day of September, which for G was 248 according to Investing.com. Snapshot at 16.30 BST.

Ocelot: agree with your posts this morning, all good points well made.

To single just one out: 'The stock is tightly held by its loyal principal shareholders: a bid to dislodge them might have to be pitched at a level bearing little relation to the share price quoted in the market.'

Yes indeed, although the word 'loyal' is not necessarily what comes to my mind - I don't know how loyal they are to the company or each other. 'Self interested' , certainly - and very keen to maximise their value. I suspect that their view would be similar to ours - that the company is significantly undervalued at the moment. When I suggested a TO premium of 30% I was simply giving the rule of thumb for 'friendly' TO situations - I was not suggesting that it would represent a good/fair price or that a TO on that basis was likely. I do think that some shareholders would be tempted at that level, however. Clearly there are a small number (by volumes) prepared to sell at £2.
Let's hope the principal and controlling shareholders have higher expectations..
ATB

JFT: Would love to know what some of you guys think and what would you do in their position......

With respect JFT, I don’t think you really would love to know what we think unless it agrees with your pov.

What I would NOT do if I were in their position is pay too much attention to small PI’s who expected the price to rocket past 300 without a pause or to squander the hard earned cash flow on some daft project or acquisition.

The sp is a reflection of what the market feels the company is worth. As a small shareholder you either agree with that assessment or feel it has potential (given current management) to do better or you feel the sp is rather high or likely to drop, in which case you should sell. If I’ve invested in a company that is being managed badly then I’ve made a bad investment decision or failed to exit at the correct point.
I believe you’ve recognised this and sold? So unsure why you are still interested.

G is not being managed badly, in my opinion, and it has good future prospects which I believe the management are pursuing diligently. Yes, I’m disappointed with progress regarding the gas development, and I believe that has held the sp back, but I am not in a position to criticise the management for that.

A very similar story for me JL.
It is usually a mistake to try to recoup losses from a given investment but there does appear to be value in G that has so far been elusive for one reason or another. However, it is only worth pursuing on the basis that progress is genuinely being made to exploit the resources that have been touted for seven years. The delay in getting gas flowing is most frustrating.

A TO now might be at a 30% premium - I guess many current holders would be happy with around 270p. but it would be a disappointing outcome from my point of view.

If you bought after 15.00, Oilheadgame, then you are potentially doing well - 203 ish? rather better than 211. Hopefully today's pull back does not signal a drop - there seem to be buyers around at these levels.

I also topped up today but needed some sign of the 200 ish support being firm- so was in at 207. It's still risky, of course, many folks invested in G will buy and sell on the basis of news speculation, either about PoO (from Bloomberg etc.) or about the KRI (much of it from Rudaw, the KRI ruling party's mouthpiece). So the price can be a bit whacky at times - little regard for reality and fundamentals.

Here's a G/GKP/Brent comparison chart for those who are interested in how these prices have moved relative to each other since the 3rd of September.
https://invst.ly/8yy91

G & GKP are each down around 17% over the period whilst Brent appears to be only down about 1.5%.

Given the low volumes involved at G (I don't follow GKP), and even allowing for wider market factors, it’s probably fair to conclude that the volatility of price says as much about the market and G’s shareholders as it does about PoO or the company itself. For whilst day-day news about PoO may reasonably trigger price movements, the resulting change in sps often looks preemptive and disproportionate. Enjoy!

JL: What do your charts say about 200? Is a fall through that critical / material or not?

I'd say (and Bottmzup made a similar point) that the price yesterday dropped to a particular trend line at about 200. Many, including me, would say that if it breaks below this line then it would indicate further falls. Charts do not give certainty - just a reasonable indication. I know you hate charts but we ideally want G to stay above the red line in this link and, for me, the lower purple line is the next important marker.
https://invst.ly/8ypz9

Indeed elcapitan.

G not performing as badly today as some suppose.
G v GKP for example (rebased to July 11th) :
https://invst.ly/8ypi3

JL - I was responding to Hydraides, who specifically said 'less than two months' - Aug 10th fell outside that window by nearly two weeks.

Either way, the loss was nowhere near 50% - which was the main point.

Hydraides: Genel has dropped 50% in less than two months .....couldn't make it up.....

At max it's dropped from 260 to 200 - that's 23%, with roughly half the drop occurring in the last three days.

.... as many seem to suppose.

In light of today’s price action, it might be reassuring to see a comparison between G and an oil major over the last three months. I’ve chosen RDSB. The comparison chart below shows the two rebased to 0% from 11th July when Genel (red) closed at 253p, RDSB (blue) closed at 2724

https://invst.ly/8yjp3

What is quite fascinating is that, apart from today and a spell of pre-H1 Results euphoria, G has spent most of the time since mid August happily weaving either side of the RDSB benchmark like a slightly over-excited sibling.

On this basis, and assuming there was nothing specific to G, today’s drop does indeed look overdone and we may well see some restoration in the relationship between them over the next few days.

Thanks Ocelot. Also on Bloomberg I noticed this adjacent item. It explains why POO is softening now, for seasonal reasons, but why there is a tightness of supply that will tend to see the price rise in the longer term. It seems there's always a reason why POO could do the opposite to what we might expect.

Oil to Push Towards $95 in Mid-2019, Morgan Stanley's Sheets Says
https://www.bloomberg.com/news/videos/2018-10-23/oil-to-push-towards-95-in-mid-2019-morgan-stanley-s-sheets-says-video

Obviously an interesting day, Bottomzup, referencing that 'old' trend with origins last December. It's a reminder that charts often indicate what we should see by applying common sense. The 'too good to be true' rise through April &May gave the typical 'hockey stick' price pattern that we all know can't be sustained. Now the sp has landed back on the more steady line it was tracing before folks got a little rash. Whether that's the end of the 'correction' I've optimistically ascribed to it, who knows? It was quite consistent with that line of argument that the price closed back at 205 today after testing lower. The next few days should tell more convincingly.

I guess fans of Elliott Waves could get almost orgasmic at the chart now, btw, looks almost text book! However, I've never been particularly good at spotting that pattern with any degree of success - even when it's as plain as a pikestaff.

There are plenty of cheerleaders for G here but, even if you filter that out, it's difficult to understand why the market values G as low as it does. It's currently only around 3x the price it was at it's absolute nadir - with a pile of unpaid receivables and little apparent prospect of redeeming them. The picture today, with good production levels, is altogether different.

Hi Bottmzup

Yes - sorry about the typo, just a mistake, can't claim any humour intended.

Thanks for your take on things - always good to see another picture. That red line on yours lands very close to today's price of 205 when I add it to mine. The sp obviously flew though 211 without registering any pause. I'll be interested to see what happens at around 195 if it continues.

On 12th October I posted some stuff about the wedge that had clearly developed, that Bootmzup had also noted, and said that the price would ultimately break up or down, adding that ‘ if it does break down then …. it could be very rough for a while. I wouldn't expect 220 to hold.’

Today’s break was not just from the ‘wedge’ but also from the +/- 20p trading range, centred on 240, it has been following since mid August To me, there seems to be some chance it will pause at around 211 but it is in something of a no-man’s land at the moment as far as I’m concerned. Naturally I’ve needed to revise the chart, now those two lines have been broken, and it is not a pleasant sight to behold. I’m now assuming a downward track unless it gets back over 240 very soon.

I’ve topped back up on the drops and, like I advised,have kept some powder dry to add at lower levels. After 211 I think it could head significantly lower - 195 looks possible and 185 has been mooted previously by some here, including me. I’m not adding more now until I see some sign of a reversal.

This chart was drawn more for amusement than anything - needs a bit more work depending on the next few days..

https://invst.ly/8x-3a

I'll go for 252 please.

No Hawkey - he talks about midstream being a build, own and operate. G will be running the upstream. This was always the plan.

Thanks Hawkey, It'll be excellent to have some clarity on this - provided G is not adversely affected, of course!

Yes Hawkey. Seems to be a recurring problem with LSE servers - they accept a post but send a 'cannot be reached' message. When it happens I try to open a second window to check whether the post has been accepted before hitting 'post' again.