Easy trades from 2nd rate on going short attacks - the ERN example

Discussion in 'Stocks' started by vanv0029, Jun 9, 2015.

  1. vanv0029

    vanv0029

    I have been posting this on other boards. For me, I would prefer to
    do my fundamental analysis and be a buy and hold type investor.
    It is not working currently. So I am trying to come up with other
    ideas. It seems to me that there may be a pattern in short attacks
    that is easy to make large safe trades from.

    Here is what I have been posting on June 8:
    ===========

    Rather 2nd rate short attack on ERN

    There was a hit piece published on Africa mostly
    offshore (except Kenya) African E&P Erin energy
    last week. First last week share price was pushed
    from around 7.70 (my starter position entry)nto 8.70,
    then the hit piece was posted to SA Pro then Friday
    is was published on SA.

    This morning share price fell to 5.50 and held on
    a lawsuit investigation PR. I made a safe 50 cents
    per share on 6.00 to 6.50 close (my timing was off,
    I should have waited and entered at 5.80). I think
    tomorrow will be down on more lawsuit PRs. Just as
    with ANFI, I think share price will rebound to new
    highs as the first 7k boe/d of crude production
    is tied in soon then as the next 7k well is tied in ove
    the summer.

    I think I will be able to buy cheaper tomorrow
    when more lawsuit PRs come out.

    The short attack comes from a hedge fund that is
    way down for the year. It is second rate because
    basic message is that ERN management are not nice
    people. Obviously, they will not be invited to sing
    in the church choir, but they are succeeding in Africa
    with different rules. Northern offshore (JF) is probably
    not too happy they canceled its drill ship contract.
    I think JF would do the same thing.
    ERN has good off shore Nigeria leases and options to
    deliver 40k boe/d on an FPSO.

    Here is the URL to the SA hit piece:

    http://seekingalpha.com/article/3235116-erin-energy-questionable-characters-at-a-stratospheric-valuat
    ion


    All the accusations are weak. Two quick examples are that
    the poster forgot to mention that the former Chairman
    of RDS is on its board and valuation comparisons are all
    to companies with dry holes and declining not growing
    production.