Member Info for Voiceofreason1

Kraken on lack of credit - completely agree

But if enq has taught us anything its patience and a willingness to hope!!!

Tigar sorry thats just nonsense - illegal and also nonsense - its a small/tiny buy back - there’s just zero cost/benefit that works for them there - and lets be clear trading £50k a day on a buy ack and saying to anyone half decent ‘this is an excellent opportunity for you to get in would have them laughed out of office’

Btfath1 - 100% with you - been disappointing not to see an upward curve but at a minimum the buybacks are getting rid of some sellers which (ever so slowly) will have an effect. One thing is for certain if the buybacks were not happening the stock would be lower (simple demand and supply equilibrium)

I am still hoping we’ll see accelerated buying into msci rebalance as its not exactly rocket science that the buyback at current rate wont complete

But all in all i am happy buyback is going and my positive head says ‘eliminate some sellers and we will see some effect’

Kraken i know you are emotionally invested in ENQ but blaming ML for their buybacks is like having a go at a train driver for sticking to a timetable.

This buyback is just so insignificant to them in the scheme of things - they will be doing exactly what they agreed with ENQ - no more no less. And the talk earlier of them pushing down prices for buyback are just so ludicrous i cant even begin to deal with them.

Definitely willing to take a bet against you on that if you want. I know i might not like labour that much personally but that type of view is just for the daily express. While markets clearly do get affected by governments the hard truth is it isnt as much as people like to think. Ultimately we’re more likely to dive on us election results that uk (as trump will probably bankrupt the us on his tax plans alone)

Looking back the buybacks are basically 10% of traded volume on each day they’ve been active - its just super quiet but as we approach end of may you’ll see a spike due to the msci rebal

I think the whole treasury/share options thing is completely normal in a lot of firms - no-one that i know of seperates this out so enquest’s decisions seem completely in line with market

As to slow rate of buy back - again - overthinking is pretty common here - mls and enq have (again like other companies ) agreed on a schedule which will definitely take into account trading volumes. As i mention before there is an msci rebal trade end of this month - on the last one (in feb) enq traded over 83m shares and more volume trades around the actual day as well - as banks position themselves - mls will 100% be aware of this rebal and discussed with enq

Ok now i got you Kraken

The terms used there are legalise to protect enq from any claims of conflict of interest (they are in all buy back agreements) - and when it refers to trading decisions thats within the framework that ENQ will have agreed with them in regard to the tranches they have set MLs to buy (ie say 750k blocks every specific period which will defintely have big days like msci factored in) - the confusing terminology is down to ‘trading decisions’ which is actually more about the nuts and bolts of each days specific trades not what you might think is a more broad sign off to give MLs carte blanche (best execution rules now are super detailed)

But i have talked to an old colleague who does this stuff - he confirmed for buy backs they 100% follow the schedule the company set them - granted he aint MLs but just google that term about trading decisions and buybacks and should come up with loads of examples with different brokers

Hey Kraken, thats a really weird set up if true - i read the rns quickly but didnt see specifics being mentioned that ML decided timing and benchmarks as that is not a normal broker activity (sets you up for client saying ‘you bought at wrong time’ )

Its normally completely decided in consultation at beginning of agreement and then the broker (mls in this case) just chucks x shares per day or per schedule into the algos to execute dispassionately to the agreed benchmark

In short it wont be decided on a specific day - ‘we’ll buy this much today’ - it’ll all be preplanned and automated

Kraken - i cant be 100% clearly but normal buybacks are directed by the company ie ENQ not ML - so ML will simply buy the specified amount to the specified benchmark (normally spread over day) as ENQ direct them to.

Maybe AB wants to push more into short period although that opens ENQ to pushing stock up - using cash to buy at ‘pushed’ prices then the stock reverts - no-one likes to see that. There is an Msci rebalance day at End of may (31st) so normally volumes will be elevated anyway there and might be their aim to get a load done then

Addendum to Kraken question - in fairness a lot of banks now just outright ban their traders and other front office staff trading in single stocks for themselves as the regulation and admin just not worth it

Hey Kraken - yes and yes (unless funds or non specific investments)

As to the bot/algo chat that goes on this forum - drives me nuts - i trade and use banks algos all day long - you could argue tht some of the high frequency guys do have bots to take advantage of stock buyers and sellers but they simply dont have any interest in specifically pushing ENQ one way or other. If there is a buyer they will simply pull their ‘offers’ momentarily so stock will go up a little more than expected or on sells they will remove their ‘bids’ so downside move on that sell is more than expected but this whole view of them pushing us down is simple nonsense.

Sometimes they are left with positions overnight but thats just when they get taken out by a broker or client to a level more than they expect but they HATE having overnight positions especially in stocks they cant hedge and are volatile like ENQ

I work on a trading desk (have worked for a decent spread of the banks in past) i understand that for retail investors like people on this forum this is a big deal (and to be clear i am heavily invested in ENQ) but no bank (and especially BAML) care about 15m of stock especially spread over a half year. They’ll have given a good deal to ENQ in expectation they this will serve them well in future biz investments if announced.

There’s simply no ‘edge’ in it for them and no reason to play any games - and the fall out from any silly games just dwarfs any gain they might make on a small fry trade like this

The suspicion i’ve always had is ENQ are buying the bonds back themselves as they yield 11.6% on par - this opinion is also held by my bond desk although with caveat that ENQs bond holdings are very ‘retail’ - with the biggest position in the 11.6%’s of 20m which is with Fido so clearly a grouping of investments (but the other debt holdings are pretty difficult to buy so this is the easy way to pay off 5-10m blocks

But until confirmed who knows?

As to partners - we’d clearly like one but fact is we are not desperate so it’ll be done if stars align

Stov, so if we have not recognised any revenue on sale to rockrose then we paid off 72m in NET debt in first 2 months from oil income? Thats AMAZING - and for record i wish it was true but as much as i love the idea of ENQ more than covering the early working capital positive then still booking in 72m paydown 2 months later i dont think you are right there

But you have your somewhat murkier view on Enq than I do - so lets see if that comes out in wash

Stevo, yeah as i said i’ll go with the companies with the actual oil people

Am somewhat perplexed how enquest have booked the money coming in from Rockrose if as you say its not real but we’re all experts on keyboards at home i suppose

It’ll come out in wash - i’m still very confident on my FCF bet btw!!!

Stevo - So while i agree Bressay and general future development does clearly get affected by gov policy - i am going to go out on limb and say Rockrose especially but also Enquest have clearly done some digging on this as its a hell of a punt for Rockrose especially to chuck in the money they have given the sensational headlines

I am aware on this chat there’s a lot of ‘experts’ (including myself obvs!!!!) but we clearly dont know as much as them, we really have no clue what conversations they’ve had and the fact is they are the professionals in the field

But hey ho lets see what the future holds

Hi - so i broadly agree that large bond issues are priced on market risk free rate and company default profile (enqs profile clearly is improving) - the difference with ENQ is that the bond issues are relatively tiny so demand and supply does come into equation which doesnt normally affect big issues.

Looking at debt schedule of ENQ i suspect the HYN’s are next on the companies radar to pay down (i dont know the term loan payback covenants) as the process itself of buying back bonds is quite simple - and given the 300m size of entire HYN its seems entirely logical that the minumum trade size of 1m that this would start to impact price - and the simple dynamics of the relative strength of ENQs cash flow in a market trading at 89 bucks a barrel market (would love to know if we are locking in some of this price level with swaps as well!!) means we’d have to be going in at decent multiples of this

Saying all of the above i simply dont know what the priorities of the company are on debt paydown now - they always seem to love the RB bond as its simple cash for them and lower rates but we’re in a great position as it stands to have to worry about this type of issue

I understand the frustration of some of the people on this board but the (sad) fact is we’re a small retail investor stock so while the news flow is excellent (debt down to 50% ebitda - and oil punching up) its the lack of buyers that is the issue. Now as a bull on the stock i am happy to keep buying (as i have done recently in fairness) but i suppose i understand the sellers just losing patience. The buybacks will help - but a bonza Q2 update will help as well to simply dispel the pessimism that is out there. I will happily keep plugging away as i expect an impressive fcf fig in the remaining H1 and with RBL gone thats a lot of buy backs or payment of expensive debt :)