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Rockhopper could be on the cusp of an operational breakthrough, but will that result in a multi-bagging share price from today’s level?
Kevin Godbold?
Published 17 November, 1:02 pm GMT
RKH
Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Image source: Getty Images
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The Rockhopper (LSE: RKH) share price has fallen by around 30% over the past month. So the stock has pinged on my radar as a potential buy. After all, with the share price near 10p, it’s up by around 78% since this time a year ago.
Potential in the Falklands
It seems the longer trend (over a year) for the stock has been up. But will that move continue? In the short term, the answer to that question could depend on the effects of speculation. But in the long term — as with all shares — it will take progress in the underlying business to keep the share price moving higher.
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But before you read on, a word of caution. Rockhopper Exploration is a tiny stock market business. Right now, the market capitalisation is only just above £57m. And the company is engaged in the oil and gas exploration and production business. But operations remain unprofitable. I’d classify the stock as highly speculative. And, to me, that means if I dabble in the shares, there’s a high chance of losing some, or all, of my money.
There was a buzz of excitement around Rockhopper some 12 years ago. Back then, it seemed as if shareholders might get rich on discoveries of hydrocarbons in the Falkland Islands region. In September 2010, the share price shot up to around 500p — a far cry from today’s lowly double-digit figure. And I’m thanking my lucky stars I didn’t get sucked into the story back then when the shares were peaking.
Imminent operational breakthrough?
But the long haul since the heady days of 2010 demonstrates how difficult it can be to commercialise discoveries of oil and gas. And that’s particularly true if the company owning the assets doesn’t have deep financial pockets. Sadly, Rockhopper’s story so far is a familiar one. And the directors estimated the most recent fundraising event in July will have given the company “sufficient working capital to the end of June 2023?.
However, Rockhopper really could be on the cusp of an operation
Made my first buy in here today. Nothing spectacular a couple of grand.
Currently see this as fairly straight 55/45 bet tilted to the upside. If it heads that way there is a great deal of ground to recover into and the price will expand.
Will look back in 2 years….good luck all
Been in here for sooooooooo long. Initial purchase many years ago at 85p. Been adding over the years and taking advantage of dips. I've ended up with way more stock than I ever wanted ...just over 60000 at an average now of 55 p.....I could see the light.
Then today..... You could not make this up. Back in the bunker and door shut.):
Yes a 2% return to shareholders in the final dividend and a 23 % to those with a bonus due.....rant over!!!;)
But decrease your principal and incur costs?
Could not agree more
Far more generous to the staff,,,23%increase in bonus.
With those results they could have added a special dividend to make up for the one in 2020......where we went ex dividend but never got paid!
Apologies....didn't check the date....it was the first article on my feed.
Sales will exceed £5 billion for the first time on results day
As the markets are second order systems they are impossible to predict.
I would guess the markets would tank if Russia invades…..but if the markets are efficient then much will be priced in already.
Read something interesting today about the US markets immediately following the assassination of JFK in 1963. Immediately dropped nearly 3% on the day. Next day had one of the largest recoveries in history at the time. Then continued on an upward trajectory.
Who would have predicted that outcome……..
What will be. Will be……and in 3 years time ( maybe 3 months or even 3 weeks) I doubt we will be discussing it…….
However……. It will be a volatile week no doubt.
BBC News - Marmite maker Unilever to cut thousands of jobs worldwide
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