In at $3.83, out at $3.90, profit = +1.44% after commissions.
Stock Trade Commentary
This is NOT profit taking; this is simply exiting at no loss. Today’s release had good news for the company: they finally figured out the proper fraccing technique to extract oil from their Lochend Cardium lands. However, I am not impressed with their IP rates. Why would I want to put my money in an IP30 of at most 200 boe/d when I can invest in Cardium areas with better reservoir quality producing IP30 rates of 300+ boe/d. There are better type curves out there; just check SKW with some of their wells averaging an IP60 of 300 boe/d, HYX’s type curve is also superior at an IP30 of 275 boe/d. The release also failed to mention TOL’s current production, while they did mention exiting Q1 with $1 million in working deficit; why not mention the Q1 exit production? Is the company hiding a massive decline rate from earlier wells?
Sure the NAV is $5.29 but that will not keep me invested in TOL for the time being, there will be other opportunities out there. This transaction wiped out my margin usage in my HELOC portfolio which gives me the operational flexibility to deploy my troops as market events unfold.
Why $3.90 and not higher? Well, I was at an offsite all hands meeting at work since 8.30am this morning. I had to run back to the office on the coffee break, sell my shares at whatever bid there was and return to the meeting. Call it the downside of active investing with a full time job!
I need a mobile phone with a capable browser, should be upgrading to a droid this year and solving this nuisance. While the price might recover above $4 in the short term, I did not want to risk my exit from this stock since I made up my mind to move on to other plays.
What’s your opinion on TOL following their news release?