SHP/Oil Update

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Shoal Point Energy Ltd. is a petroleum exploration and development company

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SHP/Oil Update

posted on Apr 24, 2020 02:32PM

From Black Gold Letter

But today I wanted to highlight their thoughts on Oil below. This is pulled from that report, but to get the full picture, you'll need to pull up their page to see the accompanying chart photos. I will let you absorb their compelling data regarding the deep value that they see in this sector. While the entire sector has bounced about 50% (explorers, producers, and service companies generally) off of their bottoms, Shoal Point Energy (SHP/SHPNF) is at its lows!

If you believe in this thesis at all, or have faith in the sector long term, adding SHP under .10 CDN is exactly what you want to be doing. Selling it down here makes NO sense! It has a $3m US market cap at .08 CDN, it's an extremely cheap long term call option on the sector. I'm on the bid in the US market now. There is no need to rush back into it, but accumulating under .10 CDN, I believe, will pay off big in time. The question is how long?

Well, the way that the oil stocks have been acting, contrary to the "negative" oil price earlier this week, something seems afoot. The recent relative strength has surprised me, and the forward looking market just might be telling us higher oil prices are not that far off in the future. SHP has a monthly burn rate of less than $25K CDN! They can weather whatever and however long of a storm this may be.

Shoal Point is no longer an advertiser with Black Gold Letter (I don't blame them-cutting costs is prudent), but it in no way changes my views on the company long term. SHP could bounce 50-70% ( to .12-14 cents) next week and would just be catching up with the sector. Selling volume is drying up. I think the lows hit yesterday are now behind us. Enjoy the Crescat commentary below....

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