Detailed discussion of Soco's assets should take place on other threads, but this thread is to discuss the latest valuations both by ourselves and analysts, sentiment (ie will the shares go nowhere because there's not much upcoming news) and likely moves in the share price in the next six months. How should the shares be valued? How reasonable is it that any drilling without a firm commitment further than several months away is ignored by the market?
I haven't seen many recent analysts' reports on Soco, but I have one from Cazenove with a core NAV of 1370p and no doubt considerable explo NAV on top of that. I imagine that's approximately concensus, but maybe with crude rising again these concensus NAV figures will start to rise. Has anyone any other recent broker estimates?
My view, as stated elsewhere, remains that in the absence of much to get the market excited the shares will wander aimlessly for the rest of 2009. I've previously guessed that if crude were $65 at Christmas 09, then Soco's SP would be somewhere near £13 then, and I'm still very happy with that guess. What does anyone else think?
Of course unexpected bids and other events may overtake this, but these sort of events may happen to any company, and perhaps Soco (where management seem unlikely to accept bids since they believe there is considerable value not recognised by the market) is one of the less likely companies to be affected by the unexpected. The key new news for Soco might be (a) a bid (IMO unlikely), (b) some sort of presentation by management of the drilling data they claim to have that demonstrates a significant strike has been made at E, currently ignored by the mkt, or (c) possibly hitting oil off the Congo.
Moderation note: posts will only be deleted from this thread by the site admins or by agreement from at least three of sirlurkalot, emptyend, djpreston and doverbeach. If three of this list agree to delete a post, the names of those three and the reason for deletion will be noted in a post on this thread so everything's completely transparent.
Disclaimer:
As per our Terms of Use, Stockopedia is a financial news & data site, discussion forum and content aggregator. Our site should be used for educational & informational purposes only. We do not provide investment advice, recommendations or views as to whether an investment or strategy is suited to the investment needs of a specific individual. You should make your own decisions and seek independent professional advice before doing so. The author may own shares in any companies discussed, all opinions are his/her own & are general/impersonal. Remember: Shares can go down as well as up. Past performance is not a guide to future performance & investors may not get back the amount invested.
SOCO International plc is an international oil and gas exploration and production company. The Company has oil and gas interests in Vietnam, which includes Block 9-2 and Block 16-1; Republic of Congo (Brazzaville), which includes Marine XI Block and Marine XIV Block, the Democratic Republic of Congo (Kinshasa), consists of Nganzi block and Block V and Angola, which include Cabinda Onshore North Block. The Company's operations are located in South East Asia and Africa. It holds its interests in the Republic of Congo (Brazzaville), through its 85%-owned subsidiary, SOCO Exploration and Production Congo SA (SOCO EPC). It holds its interests in the Democratic Republic of Congo (Kinshasa) through its 85%-owned subsidiary SOCO Exploration and Production DRC Sprl. The Company’s net entitlement volumes were approximately 15,500 barrels of oil equivalent per day. more »
1122 Posts on this Thread show/hide all
In reply to Isaac, post #522
There is no such thing as a floor on oil prices. Nevertheless.....
....there's nothing wrong with that logic, even though the figures can all be debated. Even private equity may soon be forced to take an interest in the E+P sector with such valuations around.....though it is puzzling that the hedge funds aren't there first. Bigger games to play, I guess....
ee
ps.....as one might guess, Isaac's "gut" in the post above is completely aligned with my own. But I don't want to advertise that fact - I'd just rather management got on with it quietly.
Looks like they bought another Central London flat.....I hear there are being sold 2 for 1 at the moment :-)
More than one thousandth of the company bought back today.....that is getting to be a decent rate of progress....
Another 267k today, and still the price fell, makes you wonder what price it would fall to if the share buybacks stopped.
http://www.investegate.co.uk/article.aspx?id=201205211736087957D
I wonder if LG is planning to sell out completely ? or even if they are the only people selling, certainly seems like there's an overhang at the moment,
K
In reply to kenobi, post #527
As discussed a few days ago, L&G are passive investors - so it'll mostly depend on the index and other external factors.
AFAIAC it is great news that people (or, more likely, computers) are happy sellers. Hope it continues for a month or three.
yes I did see something about that, can it be that they only have passive funds ?
their shareholding in soco has gone from over 9% to below 3%, can their passive funds really have fallen by 2/3?
I wonder what other companies they have sold out of in this volume ?
K
In reply to kenobi, post #529
L&G have never held over 9%. In fact I don't think they have ever held over 4%!
You are confusing them with Blackrock (who are also largely index funds, but who perhaps have different capital pressures or different algorithms)
In reply to kenobi, post #529
Yes I did see something about that, can it be that they only have passive funds ?
No, they don't. L&G are very big in Index linked (passive) funds, but they also have substantial Managed (active) funds, including unit-linked equity funds and a diminishing but still large traditional with-profits fund which is primarily invested in equities.
Reduction in their passive exposure is no doubt at least part of the reason for L&G's reduction in Soco, but there could be an element of reduction (or increase perhaps?) in the managed side. What we are seeing is a net effect of all their holdings in Soco - it's quite possible their Index traders are selling while their "Managed" traders are buying.
redhill
Don't forget that the buyback in terms of the number of shares in issue is relatively small. I think ITRO 1-2% of shares outstanding bought so far (not sure of exact details). But if L&G were reducing their weighting by 1-2% this would account for all the extra sells being mopped up by the buy back.
I'm afraid the buy back is still rather feeble in terms of total shares in issue.
Log
As I mentioned before, whether L&G have predominantly passive or active mandates doesn't really matter if the overriding factor is net redemptions from those mandates which forces sales of equities - it's unlikely to be possible to build an accurate picture of why L&G are selling without either being an L&G insider privy to that information or by having details of all their holdings, net subscriptions / redemptions to their various mandates, understanding the liquidity of Soco and the other shares within those mandates, the algorithms for the passive mandates etc etc.
Absent both of those, I think it dangerous to draw any meaningful conclusions about the asset managers' views on the share based solely on the material holdings' RNS announcements from the likes of L&G and BlackRock.
Regards
In reply to loglorry, post #532
For the record the number of shares purchased in the current buyback exercise is 5,026,752 which is about 1.4766% of the shares in issue immediately before the first buyback purchase.
Total cost so far (excluding dealing charges) is £14,050,518.
MT
Thanks MT for that very interesting. Obviously, there are quite a few in directors hands so if you exclude them the % of the free float is a bit higher but still probably not that much if for example L&G and Blackrock were looking to reduce holdings by 1% each for technical index tracking reasons.
Log
In reply to mangotree, post #534
yes mt only 1.4766% but it has accelerated rapidly it took a long time to get to the first 1%, many months, we've got to the other nearly ,5 % in a fraction of that time. As ee pointed out they bought back about .1% in one day a few days back.
cheers K
In reply to emptyend, post #530
L&G have never held over 9%. In fact I don't think they have ever held over 4%!
sorry EE my mistake I thought I had read those figures here,
306k today, again getting on for 0.1%
http://www.investegate.co.uk/article.aspx?id=201205221736368842D
not sure what volume was today and if they could buy more than this even if they wanted to. Even at this kind of rate it would take some time to get to say 10% . (17 weeks assuming .1% per day). I would be keen for the management to consider a tender offer as discussed here previously. But it does depend on the cash they currently hold and whether there are any plans requiring cash that we're not aware of yet.
K
Net vol for the Day 753,146
Soco bought back 306,800
http://www.investegate.co.uk/Article.aspx?id=201205221736368842D
Did the broker sit on the bid for most of the day? Soco bought back almost half the volume....They seem keen.. :-)
Is it not interesting how the 5 year chart shows a W shape forming? I suspect the next significant move will be up, to complete the W. Question is where will the W complete @ £5 or £6 ? :-)
Soco Share Price (5 years)
Is it not interesting how the 5 year chart shows a W shape forming?
Yes it is not. It's all meaningless nonsense.
I wonder what Walter Joseph Kovacs would make of the chart..
Buffy
fwiw
avg vol last 20 days is 760k = max daily buy back of 380k