RE:RE:RE:RE:RE:RE:STC Not Alone In 2021 Share Price Drop
masfortuna wrote: Hey Long!
f you don't know anything about oil and gas, then I would recommend that you don't comment on it. As an fyi, Saudi Arabi is having a hard time meeting the agreed increase in supplies agreed upon last year NEVER MIND increasing it further. Russia maybe? It appears Russia has maxed out its output capacity. Iranian oil? China has been buying 400k barrels a day illegally for the last 6 months. I could go on. I think oil will be in a bull cycle for the next 2 years at least.
As for STC, I have been a holder for the last 2 years. Although I initilly bought sub $2, I have added premerger in the $3 range. I am pretty much even after 2 long years. I am willing to wait BUT this has turned out to be a little disappointing to say the least.
Mas
Sure there is money to be made but as a long term capital compounder I would say most don't do too well. I usually stay away from the resource sector unless I can find a stock trading significantly below its net assets and has a strong cash flow position.
I've done well with a couple oil stocks in 2021. If you look back across many of these companies they have not fared well over a 10 year period. You'd be hard pressed to find any company in the oil sector that has compounded over 10% per year over the last 10 years. Suncor was trading around $24 about 10 years ago and its just over $28 now. Yes, you've collected some dividends but that's about it. There are times such as last year where the risk/reward trade off was too attractive to not consider a long position.
I believe there is good value in oil at the moment but I view the sector as a cigarette puff. It is important you sell at the right time otherwise you'd be holding the bag like the people who bought oil 10 years ago.