PennyMac Mortgage Investment Trust T.PMT

PMT not moving up with high oil prices

[shambano1]

interesting trading here.

PMT does have heavy oil which they are using enhanced oil recovery to increase production and more importantly reserves and this will increase the value of these heavy oil fields.

PMT is drilling 5 heavy oil wells in 2017 to increase oil production so they will do well with the rise in oil prices in h1-2017.

Now NG is trading lower today which could explain the weakness in PMT's SP?

not sure and PMT is planning a NG drilling program to ramp up NG and liquids production at east Edson and fill their plant's capacity, again a good thing since costs are very low and they can make money with the current strip pricing.

so all in all things are looking up for PMT but it will take some time as new investors come aboard after the large drop in SP that occurred from 2014 to 2016 - q1.

time heals  all wounds even PMT wounds, and better to have some wounds than be dead which someone has already mentioned.

bottom-line PMT survive, keep their best assets and has a lot of growth opportunities for the future.

where commodity prices will go short term and long term is another story but for now, things are looking up.

cold winter is just starting so don't let commodity traders tell you any different, NG prices will go higher with large increase in heating demand along with other demand centers, like power generation and exports, to Mexico and LNG and more LNG export capacity starting up  in the new year.

my target for 2017 is still 3.30 to 3.75 if commodities continue to strengthen and stay strong all winter.

just me 2 cents DYODD