by Travis Johnson, Stock Gumshoe | January 23, 2014 4:01 pm
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I have been waiting to hear what you have to say about Africa Oil. It has some potential big events coming up this quarter and has been doing pretty well since you last mentioned it. Any current / near future comments?
I’m due to have another good look at their numbers — they keep finding more oil. Hope to get to it soon.
Having some trouble at the moment because of emerging market fears and oil price fears, but I still hold my shares and like it. It’s starting to look more like they actually want to build into a developer and producer instead of shopping themselves to a major or selling out to Tullow, though you can never really know. They keep finding oil, testing keeps being promising — if we assume that they avoid violence that shuts down their operations, the real question is whether they’ll develop the infrastructure in partnership with the Kenyan government fast enough to please shareholders. Estimates of earliest possible production are 2015, but that seems ridiculously optimistic — it’s hard to see “commercial” production, which would require roads and pipelines, before 2018. Interesting article on them here.
Any thoughts on KonaRed or symbol kred, looked like a just another touted penny stock but had quite a run this week. Any comments?
$80 million market cap now after being pumped up, off of a reported $800,000 in revenue. Half a million in debt, just about no cash. Never heard of ’em before, but looks like junk to me.
FYI, both TPRE and GLRE are coming down a bit as they had negative investment returns in January — GLRE portfolio down 1.5%, TPRE down 1.8%. That’s actually good, relatively speaking, because the S&P fell significantly further (that’s what hedge fund are supposed to do — protect against big negative moves and keep returns steadier), but it will lower the book value eventually unless insurance earnings are better or the portfolios bounce back. Both did well in the fourth quarter in terms of investment returns, so they’ll probably still gain in book value when the next quarter is announced. TPRE is more dependent on investment gains because they’re at least six months from breaking even on underwriting, so it should arguably hit them harder if they have a sustained weak investment performance for a few months, but it might easily be that a bad month or two from either of them provides buying opportunities — GLRE may have a terrible February because of the huge burst at Green Mountain Coffee after Coke bought 10% of the company, that’s one of their widely-discussed short positions, so I’ll be holding off and hoping that this hits the shares and provides a buying opportunity. For TPRE, it’s still a stretch valuation at $15 but it’s better than $16+, starting to think about another nibble if we get a few down days — that might come as their six-month IPO lockup expires and insiders will soon be allowed to do some more selling. The reinsurance environment is not super profitable right now, given all the competition, but TPRE and GLRE have the advantage of great long-term investment performance.