Author Topic: PWE - Penn West Petroleum  (Read 424818 times)

alertmeipp

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Re: PWE - Penn West Petroleum
« Reply #20 on: July 31, 2014, 02:50:44 PM »
Thanks for sharing your #s. The recent weakness and the accounting news do provide good opportunity to load up. Some tidbits.


http://www.bnn.ca/News/2014/7/30/Canadian-energy-giant-Penn-West-reveals-accounting-irregularities-.aspx


“Although [second-quarter] production volumes were better than expected, we believe that the improving operations strategy will be overshadowed by the accounting audit and its potential ripple effects across the business,” Wood said in a research note. “Although Penn West appears to be forthcoming in its findings early on, the broader impact on financial operating measures is relatively unclear today.”

Penn West did not say which employees are “believed responsible” for the accounting irregularities, but noted they are no longer working for the company. The review arose from information brought to the attention of chief financial officer David Dyck, who started on May 1, taking over from Todd Takeyasu. In an interview late Tuesday, Mr. Takeyasu said the committee’s concerns could be a result of different interpretations of accounting methods.

“Some of this stuff is grey, but I’m probably not at liberty to say much,” he said. “Some of that is possibly a matter of documentation.”

Penn West’s former chairman, Bill Andrew, who is now chairman and CEO of Long Run Exploration Ltd., was not immediately available for comment.



Uccmal

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Re: PWE - Penn West Petroleum
« Reply #21 on: August 07, 2014, 05:32:55 AM »
Quite a good article on the PWT nnsense:

http://www.calgaryherald.com/business/Yedlin+Penn+West+reaction+inflated/10092994/story.html?__federated=1

biaggio, I too,would like to increase my position.  I am trying to scare up some cash.  Dividend is nearly at the 7% level again. 
GARP tending toward value

Myth465

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Re: PWE - Penn West Petroleum
« Reply #22 on: August 07, 2014, 06:00:41 AM »
I bought more leaps.
Much more confident on PWE than last time it was at 7.

People say its very similar to martinrae which rebounded quite well.
I am an accountant, and honestly this pullback doesnt make much sense.
If you dont know the company then I can understand why you would sell, but this is new Management fixing things, not old Management hiding things....

Andy Dufresne

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Re: PWE - Penn West Petroleum
« Reply #23 on: August 07, 2014, 06:12:46 AM »
Myth,

Can you explain your confidence? Assuming you bought the Jan 2016 strike 7 at the closing price of USD 1.4, you are effectively paying 13.7% annualized for 17 months AND giving up 7% in the dividend, so it's paying almost 21% for 5.35 times leverage (7.5 divided by 1.4) ...

Just trying to get a handle on your thinking here

Thanks!

Myth465

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Re: PWE - Penn West Petroleum
« Reply #24 on: August 07, 2014, 06:43:26 AM »
I bout the $5 Jan 2016, prefer the leverage to the yield.
It was about 15 cents away from being in the money.

Andy Dufresne

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Re: PWE - Penn West Petroleum
« Reply #25 on: August 07, 2014, 06:59:46 AM »
Ahhh, you bought ITM :) thanks, I understand!

SmallCap

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Re: PWE - Penn West Petroleum
« Reply #26 on: August 12, 2014, 03:54:23 PM »
At this price I am interested in buying but I decided to do it in a different way and would love some input and opinion about this method of buying into PWE

I am comfortable buying at this price but I was checking out the options and ended up writing some puts instead.

as an explanation I am doing this in an IRA account so there isn't any margin so they reserve the cash. Right now I have over 50% in cash because I haven't found enough that I'm interested in. so I have a bunch of cash sitting there doing nothing.

I wrote some Jan 2015 $7.00 puts and received $0.70 premium.

my thinking went like this

Result A: stock drops below $7 and I now own the stock at a effective purchase price of $6.30 - downside: similar to my buying the stock outright except I am getting in at a lower point then it is currently ($7.37)
Result B: stock rises or stays stable and I make 23% return rate on my reserved cash for 5 months - downside: if it goes up significantly then I will have missed out on the significant appreciation but then again I should be content with 23%

First time I have done this so I would really be interested in your thoughts about my thinking and if I am missing something.
Love watching what people can accomplish through business.
www.sethgetz.com @sethgetz

Uccmal

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Re: PWE - Penn West Petroleum
« Reply #27 on: August 13, 2014, 12:54:33 PM »
I actually increased the my position size by about 15%, then backed off, and sold it for 1 cent higher.  If this restatement results in the dividend getting cut, the stock will be crushed.  I expect that is why it is trading down so dramatically. 

Whether that comes to pass or not, I would rather be less exposed right now.
GARP tending toward value

goldfinger

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Re: PWE - Penn West Petroleum
« Reply #28 on: August 13, 2014, 03:28:34 PM »
You are completely out of it or you sold your new shares only?

alertmeipp

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Re: PWE - Penn West Petroleum
« Reply #29 on: August 13, 2014, 06:56:52 PM »
Based on what we know, it's unlikely that the dividend will be touched. They just provided an update, they found no material new info YET which is a relief (I take it they should have looked at 2014 #s by now?).

Their payout ratio is low, ~25% and they have some buffers due to stronger pricing deck and production.

Stock dropped nears 20%+ since the news broke, I am holding on now.