Posts for Ticker ‘LNG’

Less Natural Gas Drilling, More LNG Imports? (BHI, LNG, BP, CHK, XTO)

nat-gas-picWe’ve been closely tracking the weekly rig counts published by Baker Hughes Inc. (NYSE:BHI) for a while now. Drilling for oil has slowed significantly in the US, and drilling for natural gas has slowed even more. A year ago, Baker Hughes counted 1,227 gas rigs; last week, there were just 810, a drop of 44%. The biggest drop came in vertical rigs, with horizontal drilling off much less. Horizontal drilling is common in the shale gas plays such as the Barnett and Haynesville shales, and tends to drain the reservoirs more quickly than traditional vertical or directional drilling.
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Posted on: April 3, 2009 – 10:36 am in Oil & Gas, , , , ,

Some Good News for Cheniere Energy, Finally (LNG, CQP, JPM)

For the past two months, all the news from Cheniere Energy (AMEX:LNG) has been bad. First, there was the triple whammy. Then there was an awful earnings report for Cheniere and its spin-off, Cheniere Energy Partners (AMEX:CQP). Last, the company’s stock hit a 52-week low on May 9th, and has dropped as low as $3.65/share since then.

Cheniere shares hit a high of $5.05 today on the company’s announcement that it has reached a marketing agreement for its re-gasified LNG at the Sabine Pass terminal. Cheniere Partners reached $9.42 earlier today, before backing off to $9.12 currently. A subsidiary of J.P. Morgan (NYSE:JPM), J.P. Morgan Ventures Energy Corporation, will purchase LNG cargoes from Cheniere as soon as the LNG gets to Sabine Pass. In return, the JPM energy group acquires some storage and re-gasification capacity from Cheniere. The mother ship, JPM, guarantees all the energy group’s financial obligations.

This is the first good news the Cheniere companies have had in some time. It does reduce their earnings potential, but the companies were so short of cash that their ability to pay for LNG cargoes was questionable. Now, however, the deal with Morgan frees Cheniere from life support. The agreement probably won’t have any impact in the second quarter, where analysts are estimating Cheniere’s loss at $1.12/share. But estimated third quarter losses of $1.29/share will almost certainly be revised downward.

Paul Ausick
June 27, 2008

Posted on: June 27, 2008 – 10:43 am in Oil & Gas, , ,

Top 10 Pre-Market Analyst Calls (AIG, BBW, CPST, LNG, CMC, DLTR, IMCL, PSUN, TDSC, TAL)

These are ten of the top analyst calls we are seeing this Monday morning:

  • American International Group (NYSE: AIG) Cut to Neutral from Buy at Goldman Sachs.
  • Build-A-Bear Workshop (NYSE: BBW) Cut to Neutral from Outperform at Credit Suisse.
  • Capstone Turbine (NASDAQ: CPST) Started as Buy at Merriman Curhan Ford.
  • Cheniere Energy (AMEX: LNG) Cut to Hold from Buy at Citigroup.
  • Commercial Metals (NYSE: CMC) Started as Buy at UBS.
  • Dollar Tree (NASDAQ: DLTR) Raised to Neutral from Underweight at JP Morgan.
  • ImClone Systems (NASDAQ: IMCL) Cut to Underweight at Morgan Stanley.
  • Pacific Sunwear (NASDAQ: PSUN) Cut to Sell from Buy at Citigroup.
  • 3D Systems (NASDAQ: TDSC) Raised to Neutral from Sell at Piper Jaffray.
  • TAL International (NYSE: TAL) Cut to Neutral from Outperform at Credit Suisse; but Raised to Outperform from Neutral at Baird.

Jon C. Ogg
May 12, 2008

Posted on: May 12, 2008 – 6:31 am in Analyst Calls, , , , , , , , , ,

52-Week Low Club (LNG, CCE, GEOY, HANS, IPAS, KNOT, TDSC, VLO)

Cheniere Energy, Inc. (AMEX: LNG) can thank its earnings or lack thereof today for its implosion.  Shares were down well over 20% at last look around $5.78, while its 52-week trading range was $6.46 to $43.50.

Coca-Cola Enterprises Inc. (NYSE: CCE) was down less than 1% at $21.48 in the last hour; prior 52-week range was $21.55 to $27.09. Who would have guessed that bottling Coke and other drinks would result in this. 

GeoEye, Inc. (NASDAQ: GEOY) suffering from geospatial imaging sector woes.  While this was well above the 52-week lows, it has been more volatile than plastique in a lightning storm, and shares went as low as $16.05 today; Prior range $17.00 to $37.37.

Hansen Natural Corp. (NASDAQ: HANS) shares fell another 5% to $28.50 in the last hour but shares were as low as $28.20.  This one is making the list more than just once now.  The short sellers that bet against this one probably feel like they are monsters in their own right.

iPass Inc. (NASDAQ: IPAS) fell sharply after earnings and subsequent downgrades.  Shares were down 16% at $2.15 in teh last hour; prior 52-week range was $2.43 to $5.69.  Selling wi-fi spots probably is going to be tough once WiMAX does really hit the U.S.  Looks like the only thing people are passing at iPass is gas.

The Knot Inc. (NASDAQ: KNOT) was down almost 15% at $9.93 last in the day after posting a 65% drop in earnings.  Maybe bridezillas are not doing research anymore or maybe they are just using wedding planners.  Either way, you know when times are tough people don’t go as extravagant on weddings.  Presumable that ad spending might be down too.

3D Systems Corp. (NASDAQ: TDSC) won "the daily fugly" award after its earnings report.  In the last hour shares were down almost 40% at $8.67; prior 52-week trading range was $11.51 to $26.50.   3-D is tough to explain to blind people.

Valero Energy Corp. (NYSE: VLO) seems counterintuitive with screaming oil prices, but its power costs and energy demands are costing more and more and it can’t pass the costs along.  Shares were at $44.70 at the end of the day and the prior 52-week trading range was $44.94 to $78.68.

Jon C. Ogg
May 9, 2008

Posted on: May 9, 2008 – 2:29 pm in HI/LOW, , , , , , , ,

Cheniere(s) Still Facing Issues After Earnings (LNG, CQP)

Last month we reported on a triple whammy that hit Cheniere Energy Inc. (AMEX: LNG).  Today, both Cheniere and its spin-off, Cheniere Energy Partners, LP (AMEX: CQP) gave their earnings report.

Cheniere Energy Inc. reported a net loss of $49.9 million, or ($1.06) EPS, for the first quarter of 2008, compared with a loss of $34.6 million, ($0.63) share, for the same period in 2007. Revenue for the quarter totaled $1.48 million. The company attributed the higher loss to operations at the Sabine Pass LNG terminal and to higher operating, G&A, and non-cash compensation costs. Analysts had been expecting a loss of $1.08/share on revenue of $250,000. The stock is down about 5% to $7.51 after 90-minutes of trading.

Cheniere Energy Partners LP (AMEX: CQP) reported a net loss of $14.5 million, or ($0.09) EPS.  The company had no revenues of the cut-off date.  The company went public on March 26, 2007, so comparisons with a year ago are based on results from predecessor companies. On that basis, for the first quarter of 2007, the company loss totaled $12.9 million, again with no revenue. The stock is flat today at $11.26 after 90-minutes of trading.

One important thing now for both companies is unrestricted cash stated on the books. Cheniere Inc. reported $141.5 million in unrestricted cash, while Cheniere Partners reported just $10,000 in unrestricted cash.  This one is not without controversy and not without risk.  But the operating prospects for both companies are good, if they can just weather the cash crunch.  That is not an assured event as of today, although the prospects may now be slightly better than last month. 

Cheniere Inc. just recently obtained an 18-month secured credit deal with Credit Suisse for $82.3 million at 16.458% interest. While that is a solid flow of operating capital that has been secured as its plant comes on-line, that interest rate is bitter medicine indeed.

Paul Ausick
May 9, 2008

Posted on: May 9, 2008 – 10:25 am in Earnings, Oil & Gas, ,

Cheniere Energy Sees The Triple Whammy (LNG, CQP)

On Monday, Don Turkleson, SVP & CFO of Cheniere Energy inc. (AMEX: LNG) owned 573,163 shares of common stock in the company. As of now, he owns 147,063. He sold 426,100 shares for what looks like an average price in the range of $11.50/share. That’s about $4.9 million worth–and according the SEC filings, the sales were made to meet a broker margin call. The stock closed at $10.86 yesterday, down about $6.00 from Monday’s close, and near the bottom of its 52-week range of $9.99 to $43.50. Ouch.

Cheniere’s share price also dived on Wednesday, from $14 to $11, on the news that Stanley Horton, the company’s President & COO was leaving the company.  Double ouch.  It also disclosed that it was near an agreement with "a major North American natural gas marketing company" to acquire Cheniere’s rights to market 2 Bcf/d of re-gasified LNG from the Sabine Pass LNG plant.

Cheniere’s spin-off master limited partnership, Cheniere Energy Partners, LP (AMEX:CQP) went public in March 2007 at $20.21/share, and closed yesterday at $11.63, a drop of 42%. Triple ouch.

The problem is two-fold. First, Cheniere has bet it’s entire existence on demand for LNG. It will own all or part of three Gulf Coast LNG terminals, the first of which to come online is Sabine Pass, which received its first tanker load from Nigeria on April 11.  Natural gas prices are high enough to support LNG imports, but domestic pipeline expansion projects have managed so far to limit the demand for imported gas. This could change by next year, but that’s potentially another one of Cheniere’s problem.

The company is low on cash and seems to be in a situation where it could have difficulty getting more credit. According to Cheniere’s 2007 annual report, unrestricted cash totaled $296.5 million, and the company admitted that "to execute our current business plan, we will need additional financing in the next 12 months, which we expect to obtain from issuing debt or equity securities, or conducting asset sales or obtaining credit support." The only thing they’ve been able to achieve so far is the marketing deal, but that only curbs the need for more cash, it does nothing to stop the bleeding (although the company did announce on Tuesday that it was cutting 200 staff).

Because Cheniere buys LNG on the spot market, it needs cash. Yet without the marketing piece of the value chain, Cheniere’s major source of income is operating the Sabine Pass plant. That alone is not likely to throw off enough cash to keep the cycle going without an infusion.

You can join our open email distribution list to hear about other special situations, back door plays into IPO’s, spin-offs. break-ups, and LP distributions we frequently preview.

Paul Ausick
April 18, 2008

Posted on: April 18, 2008 – 10:02 am in Oil & Gas, ,

52-Week Low Club (AIR, AVR, LNG, CLX, CTAS, DELL, XXIA, LNET, MNST, PNCL, SSCC)

These are far from all of the lows, but these are many highlighted stocks that traders will care about.  The prices for today are based on the last hour of trading and prior ranges rather than the closing prices for this Friday.

AAR Corp. (NYSE: AIR) hit a new low today on no direct news from a 52-week range of $22.06 to $39.42.  Shares were down over 7% late in the day at $20.91.  Hmm.. products, services, and maintenance to the airlines.  Go figure.

Aventine Renewable Energy Holdings, Inc (NYSE: AVR) down to a new low despite an upgrade by Broadpoint Capital. Ethanol stocks have dipped this month after a report that corn-supplies will be tight this year. Hit a new low of $4.22 late in the day from a 52-week range of $4.39 to $20.85.

Cheniere Energy Inc. (AMEX: LNG) down today on a downgrade by Lehman Brothers yesterday, despite announcements that its LNG terminal in Louisiana will begin to receive shipments on August 12. Shares down over $2.00 to new low of $16.17 off a 52-week range of $18.40 to $43.50.  This huge drop almost seems counterintuitive with sub-projects coming online and with energy prices in the stratosphere, but that downgrade from Lehman yesterday is ruling the roost.

Clorox Co. (NYSE: CLX) down to lowest points since 2004. Thursday, a Bernstein analyst estimated that third-quarter earnings could be lower than previously expected. Shares hit as low as $55.16 earlier today on a 52-week range of $55.37 to $69.36.  Maybe the public realized how bad bleach is for the water supply.

Cintas Corp. (NASDAQ: CTAS) dropped to a new low after a downgrade by Lehman Brothers. Shares hit a new low of $27.35 before recovering late in the day on a 52-week range of $27.41 to $41.04.  Uniform sales… what gets cut as employees get fired and as businesses trim expenses? Oh yeah, uniforms.

Dell Inc. (NASDAQ: DELL) fell along with the market today with the other computer companies. They just happened to hit a new low. They dropped to $18.44 on a 52-week range of $18.53 to $ 30.77.  The good news is that late in the day shares were back above the prior low.  The bad news is that nothing is going its direction.

Ixia (NASDAQ: XXIA) taking a hit from downgrades by JMP Securities and Ferris Baker Watts. They also cut their own guidance for first quarter estimates. It hit a new low of $6.30 off a 52-week range of $6.51 to $10.70.

LodgeNet Interactive Corporation (NASDAQ: LNET) down to a new low of $5.70 today. Apparently good hospitality isn’t enough keep the shareholders comfortable. The 52-week range is $5.90 to $38.11.  As people cut back, maybe those in-hotel movies are easier to cut spending on.

Monster Worldwide, Inc. (NASDAQ: MNST) hit a new low today with a 52-week range of $23.00 to $50.28. It shouldn’t be out of a job anytime soon but if it is, it will know where to look.  Shares down almost 4% at $22.20 late in the day.

Pinnacle Airlines Corp. (NASDAQ: PNCL) taking a hit in the wake of Frontier Airlines bankruptcy scare. Hit a new low of $8.22 on a 52-week range of $8.43 to $20.34.  Stock edged back above that $8.50 level in last 20 minutes today.

Smurfit-Stone Container Corp. (NASDAQ: SSCC) dipped to a new low off a 52-week range of $6.65 to $14.08.  Shares were at $6.35 in the last 20 minutes today, down almost 8%.  paperboard and packaging… what gets cut when stuff stops selling stores?  Oh yeah, the packaging.

Jon C. Ogg
April 11, 2008

Posted on: April 11, 2008 – 2:55 pm in HI/LOW, , , , , , , , , , ,

Top 10 Pre-Market Analyst Calls (ADCT, ABC, CAH, MCK, CRUS, LNG, HAIN, ISRG, NFS, PTR, VMED, WLK)

These are the top individual analyst calls we are focusing on this Thursday morning in pre-market trading:

  • ADC Telecom (NASDAQ: ADCT) raised to Buy at Deutsche Bank.
  • AmerisourceBergen (NYSE: ABC), Cardinal Health (NYSE: CAH), and McKesson (NYSE: MCK) were all downgraded to Hold from Buy at Citigroup.
  • Cirrus Logic (NASDAQ: CRUS) Cut to Perform from Outperform at Oppenheimer.
  • Cheniere Energy (NYSE: LNG) cut to Equalweight from Overweight at Lehman.
  • Hain Celestial (NASDAQ: HAIN) Cut to Underweight at JP Morgan.
  • Intuitive Surgical (NASDAQ: ISRG) started as Buy at Lazard; started as Market Outperform at JMP Securities.
  • Nationwide Financial (NYSE: NFS) Raised to Buy from Neutral at UBS.
  • PetroChina (NYSE: PTR) cut to Sell at Citigroup.
  • Virgin Media (NASDAQ: VMED) cut to Neutral at Jefferies,
  • Westlake Chemical (NYSE: WLK) Raised to Overweight at Morgan Stanley.

Jon C. Ogg
April 10, 2008

Posted on: April 10, 2008 – 6:54 am in Analyst Calls, , , , , , , , , , , ,

Top 10 Pre-Market Analyst Calls (ADSK, BRKS, CVC, LNG, ITG, SNN, TTEK, TSN, YHOO, AUY)

These are not the only analyst calls out there this morning, but these are the top ten that 24/7 Wall St. is looking at this morning.

  • AutoDesk (ADSK) raised to Buy from Neutral at Goldman Sachs with a $52 target.
  • Brooks Automation (BRKS) raised to Outperform at Bear Stearns.
  • Cablevision Systems Corp. (CVC) lowered target from $33 to $31 at Goldman Sachs.
  • Cheniere Energy (LNG) started as Buy at Banc of America.
  • Investment Technology Group (ITG) raised to Outperform at Keefe Bruyette & Woods.
  • Smith & Nephew (SNN) raised to Outperform at Bear Stearns.
  • Tetra Tech (TTEK) started as Underperform at BMO.
  • Tyson Foods (TSN) raised to Buy at Deutsche Bank, after yesterday’s blow-up.
  • Yahoo! (YHOO) raised to Outperform at CIBC.
  • Yamana Gold (AUY) raised to Buy at UBS.

Jon C. Ogg
November 13, 2007

Jon Ogg produces the 24/7 Wall St. Special Situation Investing Newsletter; he does not own securities in the companies he covers.

Posted on: November 13, 2007 – 7:55 am in Analyst Calls, , , , , , , , , ,