RE:RE:RE:GDP up 5% premarket after yesterday's 9.7% jumploneranger, we are but two small fish...but what I do not understand is why a big player (Exxon, Chevron, BP, Eni, Repsol, EOG, etc.) is not jumping on them right now.
The Middle East is turning into a quagmire...again. Russian exploration could be limited going forward (hurting XOM and BP)...Africa is also a mess...in those troubled times, to buy ECA makes so much sense...
It reminds me of EOG three years ago. When it was obvious that they had acquired the best shale acreage in North America. I thought to myself that XOM or others would only have a small window to acquire all this acreage and expertise at $30Bn market cap + premium + $5Bn net debt...well, now EOG is at a market cap north of $50Bn...much harder to swallow, even for the giants....but now comes the ECA opportunity, their shale acreage is world class. Their growth and expertise in shale drilling is not questioned. Throw in billions of cash (making net debt only $1Bn by year end!), Deep Panuke which they can keep or try to get $2Bn+ for and their very valuable stake in PSK and you have the most compelling large E&P firm in North America.
CLR, EOG, PXD might have better acreage and growth prospects...but their market caps are much higher; all three have gone up more than 200% in the last two years. ECA is down 2% over the same period!
Definitely one for the college fund, but I expect a takeout offer if the stock keeps lingering. Management should realize that a 30% premium would take them out only at $26 (USD)...that would be unacceptable given the speed of the turnaround and the clear growth trajectory ahead of them...let's see what happens next, I expect some action sooner than later!