Three golden rules for trading offshore drilling campaigns which have a 10-20% COS at best....
Rule 1: Buy early then sell/take profits into the prespud. Never over commit capital. Downside is typically 50% to 90% followed by an ugly cap raising if the company does not have sufficient capital to move on after.
Rule 2: See Rule 1.
Rule 3: SEE RULE 1!
MEO management are actually good with their capital, before they drill each duster they always raise cash before drilling to cover costs and turn to the next big play when the dust settles. Perhaps why they are still around. Rinse and repeat please, (Tongue-in-cheek).
MEO Price at posting:
7.4¢ Sentiment: LT Sell Disclosure: Not Held
