Price The Market Part 24
Glen is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Hello and welcome to my journey of pricing the entire S&P500. Frankly, it surprises me that more people haven't figured out that this is something worth doing. But then again, I'm a crazy person.
126. Denbury Resources (NYSE: DNR) got destroyed back in 2008 and 2009. Of course here comes Barclays Capital with their price target that roughly doubles the current stock price. I sometimes think that Barclays energy analysts have high turnover. Barclays keeps raising their price target and the stock has gone in the opposite direction. I think that this is Barclays stance on oil heading significantly higher and the pumpfake earlier this year. If this is the case I'll split the difference. Target: $20-$25. I'm assigning this target because I feel that crude prices are likely headed higher as things escalate in the middle east.
127. Devon Energy Corp (NYSE: DVN) solidly bottomed in October at $55. While there are doomers and gloomers planning a global crisis of unknowable proportions, companies like Devon are screaming: "Buy me!" Target $70-$75. Of course analysts put their targets above my target. They are paid to pick the price that no one should ever be willing to pay: Full Price. The greatest thing about analysts is that their price targets almost always are raised once they hit this price.
128. Diamond Offshore Drilling (NYSE: DO) has been doing a great job setting lower highs since 2008. I really tried to come up with a bullish case for Diamond but have to concede that I think it's fairly valued. Target: $55-$65. Obviously, if oil goes through the roof, I'd have to come back and revisit Diamond, but I'm in no rush at this point. The usually overly optimistic Barclays isn't even feeling Diamond. Yikes.
129. EOG Resources (NYSE: EOG) is converting from a gas company to an oil company and is forecasting earnings of about $6.1 per share in 2012. That puts their present P/E at 16.5. I think that this is overvalued. Target $85-$95. What short term looks like a growth company is simply a transition in disguise. It's too bad that natural gas prices have been cratering ever since they disconnected from oil prices.
130. El Paso Corp (UNKNOWN: EP.DL) is an acquisition target. Target: $26. There is no sense in trading or talking more about this now.
Extra: A request from Sasi: TranS1 Inc. (NASDAQ: TSON) still has Lehman Brothers showing up under their Analyst ratings with a price target of $18 for a stock at around $1.80. Good job Lehman Brothers. Since then TranS1 has perpetually set lower lows even though we saw what appears to be a dead cat bounce in 2011. This company has perptually lost millions of dollars since it was started. I wouldn't buy this, because I stick with companies that make money. Their liquidation value is around $54 million but you have to factor in that they are losing $16M a year. They are presently trading around their liquidation value at $1.87. I guess my price target is $1.20-$1.50 for now. But I don't see why this wouldn't go to $0 in the long run unless they turn their ship around.
Glen and his investors hold no positions in any of the companies mentioned.