Member Info for romaron

Maybe "forcast earnings" is too nebulous a term. I like EPS and on that basis we are very undervalued but EPS has been discussed on here many times before.

That's not brilliant then as we'll have a lower multiplier than BP. It's beyond my abilities to backfill and work out just what "forecast earnings" are. The EV of BP is roughly the same as 30 June so $123.84 bn https://ycharts.com/companies/BP/enterprise_value
so divide by 2.3 and we're looking for $53.84 bn divided by 4 which is impossible as Quarters are drastically different but even so looking at Q1 and Q2 RNS thre only number that comes anywhere near is operating cash flow.
Even so the author Emma Powell writing as Tempus in the Times says 2.3 time BEFORE taxes and other charges and that it is the lowest in at least 9 years. That is why I used the subject 'Bottom' because I do think we are bouncing along it. IMO they have built a recession into models and for the market to get it right only continuing bad news will support this ratio. Holders here are betting against the market because it is hard to deny the impact of FCF. Few other sectors are winning and oil is an essential of almost everything we buy.
I also consider that ratios will improve for us with a rating change following reduced debt but we have to consider the whole O&G sector which has been maligned for so long. We'll probably even get the blame for Ian.

Anyone who can explain (within a range) what OUR "forecast earnings" in an "Accounts for Dummies" format would be appreciated.

Hi KO - I think I was a bit overexuberant about the earnings in my initial post but I was trying to be more directional and fine-tuning of numbers is not my speciality. I leave that to the Swedish team. Tarmak with the detail and Pelle to simplify it so I can understand it. Of course I could even be on the low side but I'm not sure what "forecast earnings" is precisely but I guess I'm too high at $1.2bn. What do the numbers guys think?

Hi Herman - At a quick glance it is a repeat of the Adam Rackley, Cape Wrath piece. They are a small hedge fund/investment company based in Llandudno I listened to him here and he does appear to know his stuff. mrc posted a link on 22 Sep https://www.stockopedia.com/content/thesis-for-investing-in-enquest-and-somero-954207/
EnQuest from about 12.40. Worth listening to imo and of course I agree with him.

O/T The Trinovantes were mortal enemies of the Cantii tribe which the Trinovantes found hard to pronounce. The cnts as they were known to Trinovantians were a snidey group who sniped and joined in battles once the result was a foregone conclusion. Many internet trolls can trace their roots back to this reviled band.

Several errors there Juan. I can't find the post so hard to defend. I sometimes lapse into local dialect such as "ain't" and the Trinovantes (Essex side - maternal) famously dropped letter especially after copious amounts of mead. Their word for through was "thogh". It also means "election" in Irish so out of context I'm not even sure what I was talking about (it is happening more frequently).
You can see SIPP's lawyer skills coming threw.

Reading a write up in the Times about BP. "Advice : Hold Why ; A cheap share price accounts for a likely fall in earnings and there is a decent dividend on offer." In the piece it said "But there is growing suspicion earnings could be set for a steeper descent amid a descent amid a downturn in global economies. An enterprise value of 2.3 times forecast earnings before taxes and other charges is the lowest in at least NINE years."
I'll take that. In USD our EV is what? Debt USD 800m MC 545m EV $1.345bn Earnings (say) $1.2bn Now I know I'm not comparing us to a FTSE100 co. but we'll soon be almost debt free so does cancel out the difference to an extent. If we can hold our earnings then in (say) a year we could potentially be worth $2.76bn or $1.46 a share. I don't think that's a crazy suggestion.

Tullow bonds took a dip today as it looks likely the merger with Capricorn is cratered with a new approach. I'm not sure we can avoid getting embroiled in something. Hopefully AB's holding means nobody will get us cheap.

Florida governor Ron DeSantis has managed to ban ESG criteria when investment decisions are made for the state's pension fund. Common sense returning.

I'm nearly thogh reading this : https://www.americanexperiment.org/reports/ The high cost of 100 percent carbon free electricity by 2040.
The report doesn't think renewables are the answer in economic terms and they are scathing about the hidden costs of renewable. You have to overbuild for reliability and you still don't have dispatchable energy. Subsidies don't reduce costs; they simply shift who pays for it. US ingenuity and a distrust of environmentalist claims are gaining traction. Plus the world ain't getting safer.

Build it. Always a market for essentials.

But how would you even know if I had misspelt?

BTW I was a bit hasty on my last post.
""The...lack of investment, low spare capacity and inventories -- has only grown stronger, inevitably requiring much higher prices."
--Goldman Sachs [on Bloomberg yesterday]

Don't be silly Juan. The real world no longer counts. It's illusory.

Only the plebs are engaged in real work and physical commodities. The clever money is all in finance and trading. You should go on Bloomberg and get educated.

https://twitter.com/monakdohle/status/1575082112189108226

It means that they are forced to provide more collateral when their strategies go wrong as with gilts this week. DB public service schemes cover 16.7mio memberships and 24,000 individual employers.
If you know this when you get a call from one of them you don't have to guess what side they're on. People got lulled into a false sense of security with low rates and took bigger risks to compensate. I'd say equities are oversold but if there is a forced seller they won't go up. Imagine being wiped out by a retired grannie?

p.s. that urgent message is from City Index but naturally the charts told you all this and you traded out of it.

These schemes will not have EnQuest in their portfolio so that's a blessing.

Further to that mrc. With a friendlier administration in place I'd say there was pressure on the majors to help companies that assist in the transition. They either do it proactively or risk upsetting the government who at the end of the day have the biggest stick.

And they can also provide assistance with finance.

*Didn't expect that. HYN fixed up 52 basis points (96.809 from 96.29) only comparison easiliy available is Tullow (3.5 years) and they're down 178 points.

I doubt very much that we have the scale to be worth shorting for him KO. Anyway, he'd be betting against Warren Buffet who I daresay gets equally good information from the markets. Information that we are kept in the dark on until it isn't of any value. However, we do have our own lifetime experiences that hold in good stead but you'll never catch the movements of the large players unless you're very lucky.

Is MS Morgan Stanley? I once had one of their traders ask if he could bid for the whole Italian BTP issue at a regular auction. I said sure if he wanted to be sacked and MS kicked out of Italy. They aren't scared of volatility or size. They will be making a fortune at the moment. As will the other banks. When people panic they accept almost any price. We used to settle all outstanding debts (points owed) in times like these. It happens because you briefly know what is happening and others don't and when people are drowning they'll grab any lifeline. You get told things like "just hit any bid with NO price mentioned". Then the Central Banks step in and you really have to be on your toes. Sometimes secretly and sometimes openly. Sometimes you'll be lucky enough to get a heads up, ching, ching. The Central Bank can operates through commercial banks openly or using them as a proxy. Trading is thinner but profits can be huge.
Crispin Odey is talking his book.

Flicked from St. Petersburg, Florida interview on CNN to Bloomberg. Both prophesying doom and the end of the world. In fact if it wasn't for the rain and the macs it'd be hard to tell the difference.

Both missing the point. These things pass and whilst a Cat 4/5 storm will cause damage the world will keep turning and I've lived through enough Cat 5 financial storms to consider these events concerning but not existential. They may well get worse but you don't need a commentary 24/7.

What did worry me though was another (less exciting) bit of news that will affect the other St. Petersburg. The US Embassy in Moscow has "advised" US Nationals to leave Russia. Now that IS worrying. What do they know that we don't? The Nordstream sabotage is probably getting more news exposure in Denmark, Sweden and Germany so YES I am worried. Governments will always say that things are under control. They aren't.

*My bunker has plenty of energy (oil) in case things deteriorate further.

KO - do you want to know my 20p Yankee picks at Kempton today?

We just don't know Juan. A lot of moving pieces and who knows how Iran will pan out. Maybe Putin will continue putting men into the mincing machine until the West runs out of ammo?
I'm not overexcited about the oil price or the IMF. The British media love negative news and things are worse in Germany and Italy etc.. To get headlines and be noticed you have to be as panic stricken as possible.
I think KK factored in the fact that it would be received this way and frankly the rise in interest rates would have happened anyway so we are (maybe temporarily) ahead of the curve. IMF are a bit like a compliance dept. and just know how to minimise a poor situation; not how to get out of one. I think KK should be praised for his proactive stance. Remember that at the major crisis of 2008 social media hardly existed. I still remember the letter to the Times when 364 Economists criticised Thatcher and her policies. They were all wrong but some continue to argue.
At times like this I'd rather be in cash or an essential commodity. I think we'll be fine.

*Dunno what will happen about the US$HYN? At the webcast Malik seemed relaxed about the maturity saying there were 2 windows of opportunity to renew/replace; Hy and fullY results. Unless its's already in the bag it does look like the window of corporate borrowing is closed. Markets don't like uncertainty and although it isn't an existential threat this time it does need addressing.

This yesterday from a friend of mine Lee Oliver who was once escorted from the Banque de France when he accused them of sniping and non reciprocation when he was dealing Spot Paris at Midland. He also ran a scurrilous website as Mr. Angry that thousands read. He was also involved in a spat with Jeff Randall where handbags were threatened. Life was once so much more interesting. It got so bad at one time the SAS got involved and he realised he was out of his depth. He quietened down after that. There are hundreds of these stories. The City isn't like that now.
Yesterday on LinkedIn
"Cable's low and the art of wrong reporting
I am quite pleased to see that cable hit an all-time low of 1.0327 this morning - not because I have a pension portfolio with lots of foreign assets in it - but because it puts an end to the erroneous reports that the previous nadir was 1.0520. Just because that is what Bloomberg says, it doesn't mean it's correct.
Bloomberg was in its infancy as a data company back in 1985 and possibly didn't even have FX data - furthermore, the market was very much OTC and opaque. I saw cable trade as low as 1.0380 on Feb 26 1985 and the BoE's reference rate in 1.0420. So I'm glad that it's over!"

We're on the same page Pelle. Bloomberg now focusing on problems with a strong dollar. Have you noticed that they always speak fast in a breathless manner. Almost like auctioneers or rails bookmakers. All to add excitement that is often not there. Most days in a dealing room are total boredom.

KO 05.36 - it's not an exact crossover but you're not wrong. The emphasis has been on gas but oil is just as important.

Build it. They will come. Physical beats financial eventually.

Correction - The highest fed fund rate was 20% in 1980 and zero in 2008 and 2020. It has been a long while since currencies were in the spotlight. A lot of people who understood them are no longer around. At Citibank when the Swiss peg was removed in Jan 2015 their dealing room went into panic mood and complaints were made about non-reciprocation on pricing from other banks. Two old analog traders there defended themselves by saying they could have used a device called a telephone. They never stopped quoting and had made their annual bonus by lunchtime.