RE:RE:RE:RE:RE:Fleeing a Sinking ShipMagic, my father, God rest his soul, was a physicist, use to always say "It is never rocket science, it is just physics". I don't believe in posting a bunch of numbers on stockboards because frankly, they are open to interpretation and I believe 99% of the people on here don't even read them. This is about fundamentals and let's look at the fundamentals of this business given the geo-political conditions that now exist.
Firstly, this is a capital intensive business. Any business with large fixed costs need to get to the economies of scale and once they do they shoot to the moon...a la Badger. The product is in strong demand, they have reached the economies of scale, and profits come in droves. There is enough business for Lonestar to do the same. I have always been a fan of adding trucks on the backs of cheap money that is out there. We need to get to those numbers and we will see the same and possible more earnings because of Lonestar's competitive advantage (larger trucks).
Secondly, we are seeing mega $$$ now moving into the Canadian oil fields. Why do you figure that is happening especially in the last few months? Russia as John McCain has said is simply a gas station masquerading as a country. The pressure of Russia's actions are pushing up oil prices and Russia also plays a large role in Iran which is also another major oil super power. I heard an analyst say today that he has no idea why oil prices are staying above $100/barrel. Huh? They likely should be higher!
Thirdly, the CDN$ is is now @$0.90 versus par with the US dollar. That means mega money for Canadian producers and quite interesting, we are watching plenty of US $ come into small, midsize energy producers in Canada!
This has created the Perfect Storm of higher prices for oil and when oil producers have more money, they utilize more oil service stocks. I am a buyer of oil services stocks, junior oil stocks...this is a BULL market. LSI will profit handsomely.
As always, I encourage investors to buy now. I firmly believe earnings takes us higher. I think if more investors understood economies of scale, this would be much higher already.