Investing

is now the time to invest in oil stocks?

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Dec 14, 2010
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greenbox wrote: Is there a mathematical formula to calculate the intrinsic value?
Depending on earnings growth, I either use Graham's formula or Lynch's formula or an extrapolation of both considering historical P/E ratio for the last 5 and 10 years.

Keep in mind this is just part of the puzzle. The other piece is estimated earnings, through market consensus and corporate guidance.

Rod
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Dec 14, 2010
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gwplant wrote: So now what market timers? Today is called follow through. Keep convincing yourself to wait on the sideline and not commit money.
As an investor, I keep adding more to the companies I find undervalued.

As a trader, I remain long on the 10 undervalued stocks (5 small cap and 5 large cap) since the rules are based on fundamentals only. And on TLT (XLB.TO) for the pure market timing model with ETFs. By coincidence, so does Mojena. Monday and yesterday bonds were higher than the market.

I also just noticed that XIV's EMA (50) went below EMA (200). Same with MA. I'll probably go long XIV again once it crosses back again.

Rod
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Sep 5, 2010
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While oil will continue to slide for a few more weeks or months, you guys are reading too much into this. Sooner or later, it will start going back up. I know things are a bit different this time, but the status quo will not remain. It should go back up to $80 per barrel as we approach the busy driving season (March Break and onward)
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Deal Guru
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Feb 23, 2008
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Brampton
Interesting bounce today and yesterday. Makes me wish I pulled the trigger and bought some energy stock on friday, but I couldn't do it.
Lets Go Blue Jays!!!
Newbie
Dec 17, 2007
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Edmonton
Good day for me - ~10% appreciation of my stocks ... cashed in at the end of the day though. Not sure if that was the right decision though - could go either way.
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Feb 14, 2006
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Kicking myself for not getting into CPG earlier. Was a bit too cautious thinking it would fall back down more after the rebound but I guess I was wrong.

Might just buy in tomorrow early after opening if it rises again... even if I lose, it pays a decent dividend...
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Aug 12, 2004
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rofl wrote: Good day for me - ~10% appreciation of my stocks ... cashed in at the end of the day though. Not sure if that was the right decision though - could go either way.
cheapmeister wrote: Interesting bounce today and yesterday. Makes me wish I pulled the trigger and bought some energy stock on friday, but I couldn't do it.
mcg wrote: Kicking myself for not getting into CPG earlier. Was a bit too cautious thinking it would fall back down more after the rebound but I guess I was wrong.

Might just buy in tomorrow early after opening if it rises again... even if I lose, it pays a decent dividend...
There is not a good or bad time here to buy short term or to time the market, need to think long term. Even should the oil price levels stagnate for a year or two or even go one year later, the fundamentals is really what continues to be the best way of measuring what to do.

properly diversified companies will not be hit that heavily. Not every company hedged themselves. Not every company is able to balance their books or even make a profit at 40-50$ a barrel.

Spot companies which are managed properly, and you will make a killing. The numbers are available for all publically traded companies, see how 2014 was forecast, and where money went, and you will have an idea of what companies to buy into. It is more important in my opinion than the 2015 forecast with the expectations of much lower oil prices. Bigger companies can cut back or put on hold exploration projects quite easily, without a significant liability to themselves.

I used the term falling knife earlier, and it still holds true right now. Not every company will survive. Some companies out there balanced their operating costs at 100$ a barrel.
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Feb 14, 2006
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That is true, there are a fair share of us who are looking to get some short-term gain and it seems very attractive, yet risky.

Being new to the investing game I erred on the safer side to wait it out. I guess this is all part of the experience.

Most of my savings are invested into TD and RY right now. CPG looks like a good company to get into as well - good dividend paid monthly, and stable history from the looks of it. What else should I look for to evaluate a company, or to do market research/news?

Also reading the Millionaire Teacher. Don't know if any of you have any input on that, lol.
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May 25, 2008
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mcg wrote: Kicking myself for not getting into CPG earlier. Was a bit too cautious thinking it would fall back down more after the rebound but I guess I was wrong.

Might just buy in tomorrow early after opening if it rises again... even if I lose, it pays a decent dividend...
If you are committed to adding CPG to your portfolio, you are doing the right thing by getting in now. You can wait for the chance that it may go back to $21, but it may not happen. If you buy now, you are locking in at a 10% yield. When you look back years from now, CPG will likely be much higher than what it is currently. You will not care that you bought it at $26 instead of $21.
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Jan 12, 2008
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Vancouver
mcg wrote: That is true, there are a fair share of us who are looking to get some short-term gain and it seems very attractive, yet risky.

Being new to the investing game I erred on the safer side to wait it out. I guess this is all part of the experience.

Most of my savings are invested into TD and RY right now. CPG looks like a good company to get into as well - good dividend paid monthly, and stable history from the looks of it. What else should I look for to evaluate a company, or to do market research/news?

Also reading the Millionaire Teacher. Don't know if any of you have any input on that, lol.
I am new to the stock picking game too, was/am still largely a couch potato. But i dipped my toes into this. I did buy on this recent uptick. While it is annoying that I couldn't buy on Monday like i wanted and lost out a bit on some gains, i think there is definitely more money to be made here, especially long term, and i didn't want to lose out on that.

Just have to find the companies you believe in, even if the low Oil prices are sustained over some time, and as STP123 stated, in a more long term view, losing out on the last two day's gains will not weigh heavily in your mind.

Maybe a buy a little now if you are hesitant, and if it falls down a bit later, buy some more to bring your average cost lower.

I really liked the Millionaire Teacher, wish i read it sooner.
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Nov 28, 2010
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Brampton
What's with the sharp rise for the third day in row. Waiting isn't helping so far and thought oil prices were headed lower?
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May 19, 2009
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I don't know about you but enjoying the surge in the past week. Up $12 per share or 25% on VET in the last week...
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Oct 9, 2008
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Thornhill
ultran00b wrote: I don't know about you but enjoying the surge in the past week. Up $12 per share or 25% on VET in the last week...
Good gain!

But the recent bounce in oil stock's SP is not indicative of a change in overall supply/demand model. The entire market has rallied over the last week so oil stocks have also enjoyed a higher bounce due to oversold conditions previously.

This doesn't change the supply/demand glut at all, it's simply market movement and increased buying in oil stocks due to speculation of a bottom.

Don't confuse Price with Value.
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Jun 2, 2009
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endokuken wrote: What's with the sharp rise for the third day in row. Waiting isn't helping so far and thought oil prices were headed lower?
I'm guessing prices have dropped so low that people think it is undervaluing good companies despite world oil prices.
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Nov 28, 2010
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Brampton
Xeros wrote: I'm guessing prices have dropped so low that people think it is undervaluing good companies despite world oil prices.
Was tempted to buy again this morning, but prices have gone down slightly again. Maybe it's wishful thinking that the knife will drop as sharply enough to eh levels prior to the past three days but I'm thinking I'll wait further this time if these prices don't reflect the state of oil and energy
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Sep 6, 2010
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endokuken wrote: Was tempted to buy again this morning, but prices have gone down slightly again. Maybe it's wishful thinking that the knife will drop as sharply enough to eh levels prior to the past three days but I'm thinking I'll wait further this time if these prices don't reflect the state of oil and energy
LOL you won't buy. Sheep picture.

For all the TA investors....TSX double bottom.
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Oct 9, 2008
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Oil rallying more than 3% to $59 per barrel earlier in the session, oil turns lower, now off 2.15% on the day to $55.57.

Bought into today's oil rally? Well now you're trapped.

If you're trying to time the market without being fully aware of exactly how the market works - fear hope & greed will always win.
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Jun 2, 2009
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Jeenyus1 wrote: Oil rallying more than 3% to $59 per barrel earlier in the session, oil turns lower, now off 2.15% on the day to $55.57.

Bought into today's oil rally? Well now you're trapped.

If you're trying to time the market without being fully aware of exactly how the market works - fear hope & greed will always win.
It's not a short term buy if you're going in today...

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