your 100% spot on like hitting the G spot

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maihoangson91

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06/10/21

17:23

Post #: 56610924
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Originally posted by Moonshine66: ↑

“Big question for the whole group......if Woodside was worth $36 in January 2020 when oil was roughly about the same as now (may in fact have likely been a bit cheaper).Why is the stock not near that valuation today? Why does it seem like 23-27 is all its worth when in Jan 2020 it was at 36 bucks in an energy environment not remotely as favourable to WPL as today”

Good question this - one many of us have grappled with over the past 12 months or so.

Here are my thoughts:

WPL dropped like a stone when COVID hit last year ....but just about everything did. But while the majority of stocks recovered strongly WPL (and oil and gas stocks generally) just didn’t.

WPL spent a lot of last year in the teens - that’s when I accumulated much of my holding. I did so on the basis that it would eventually be a ‘re-opening’ stock and should in theory return to pre COVID highs. I was prepared to be patient.

It had a run on the back of the positive vaccine news from Nov 2020 and went from $18 to $27 in a few months. Then it started to go backwards again (until recently) I think for a few reasons.

(a) COVID dragged on and the worldwide re-opening has been pushed back ...and pushed back....and pushed back

(b) The ESG crowd seemed to get some traction with superfund boards.....and banks.....and government. Support for oil and gas stocks was evaporating.

(c) Given the above WPL didn’t look to have a very bright future with stranded assets and the worry of woke governments imposing all sorts of charges and levies.....uncertain future cashflows/debt levels also created doubts.

This obviously tested the resolve of many of us longer term holders. Many joined the rush for the exits. I can’t say I never doubted the overweight position I’d put myself in - because I did.

Then a few things changed.

(1) The BHP deal handed us quality oil assets to balance out the gas bias of ‘old Woodside’ and also sured up the financials.

(2) Senior leadership uncertainties were resolved

(3) A worldwide energy crisis......not the reality of it .....just the possibility of it is all the stockmarket needs ......sends the price of oil into orbit. Suddenly Scarborough - not so long ago a worrying ball and chain ....is now an asset with a real future - one that should attract some buy in

(4) The above put the spotlight on the ESG crusaders ......you know ....living in their parallel universe where, overnight, oil and gas can be replaced by wind and sun ....and fairy dust.The reality that the world needs oil and gas for a good few decades yet is being reaffirmed right now in the markets. The ESG crowd have been temporarily silenced.

So as to your original question as to why the WPL sp is still way short of its $36 pre COVID high.......well I think it’s a case of (1) (2) (3) and (4) above still fighting but not quite yet overpowering and winning the battle against (a) (b) and (c)

PS pleased to see the sp hold above $25 today in a down market. A little consolidation now wouldn’t be a bad thing (it is up 28% in the past month afterall)

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your 100% spot on like hitting the G spot

WPL Price at posting: $25.04 Sentiment: Hold Disclosure: Held
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(20min delay)
Last $27.88		Change 0.000(0.00%)		Mkt cap ! $52.93B

Open	High	Low	Value	Volume
0.0¢	$28.20	$27.85	$2.096M	65.5K

Buyers (Bids)

No.	Vol.	Price($)
2	1430	$29.50

Sellers (Offers)

Price($)	Vol.	No.
$25.11	10624	1

View Market Depth

No.	Vol.	Price($)
1	1000	29.500
7	5830	29.270
1	3	29.240
3	250	29.040
1	2490	28.990

Price($)	Vol.	No.
25.110	10624	1
26.480	175	1
26.490	35489	18
26.600	6963	2
26.950	3349	3

Last trade - 10.08am 09/05/2024 (20 minute delay)


Last $28.10		Change 0.000 ( 0.66 %)
Open	High	Low	Volume
$28.07	$28.12	$28.04	40725
Last updated 10.25am 09/05/2024 ?

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your 100% spot on like hitting the G spot

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