14-18-2015 round up #OXS #CEB #FOGL #PEL #AFPO

Evening.

A few interesting things happening and a few on the horizon. So I thought a blog was in order.

Lets start with something positive, #FOGL has an important drill due to be announced. Depending on results this might indicate a massive increase in the OIL reserves and wealth around the islands. Logging should be finishing in the next two weeks so news is nailed on. Personally with oil at its current low price, I will be watching but not buying before news, but it should be interesting.

Now onto #OXS, usual fun and games, with an August result unlikely (historically) we are looking more and more at an Autumn/Winter result. Still a firm hold for me, but I am happy to ignore all the rumours and wait.

I have been researching #PEL as promised. My initial thoughts ( and I am only half way through researching) is that the company looks to be a classic rehabilitation candidate. The biggest problems with these, as I've learnt many times is that the market doesn't believe these recovering companies, until its seen the evidence of good profitability in trading statements. The real question might be when will the company release these trading statements, but anyway more work needed from me.
BTW when I mentioned that the company might be being ramped, it doesn't imply anything concerning the companies true potential, just that there is an influx on short-term money that will be leaving the SP at some point. When this happens we normally see either a dramatic decline or a gradual decline depending on who brought the shares when the short-term holders sell. This might well be a long-term hold in the same vein as #AEG, I am not decided yet.

#CEB....Wow..Just Wow on the day that the company announces its AGM, you get not one, but two director sells. One director sell, you can put down to bad luck or unusual circumstances, but 2 directors..

Quite simply for experienced AIM investors, director sells are a red flag. Its very rare for a company to see its SP rise after director sells. When the directors sell, just prior ground breaking news I have never heard that it bodes well.
We will hear all kinds of things from the ramping crew about this as they struggle to sell out. Over the years I've heard all the excuses as to Directors selling, from pension arrangements, divorce, needing the money to put the kids through education, ill health. The consequences for the company though are pretty uniform.

A simple question these directors will have known most things about the company, they will certainly be aware of the potential for any new Indonesian deals. So why sell now and not in 30 days time?
For me it indicates that the Directors were pretty certain (at least in their minds) that large dilution will occur when the deal goes ahead.
I've been accused of not being researched in #CEB, but that's simply not true. I've researched Indonesia and the Philippines at length, producing a PEST analyst on both. The reason for this is that both companies were considered excellent frontiers by Aussie mining companies when the Aussie industries were booming. There is a graveyard of projects left by this Aussie expansion.

Indonesia in particular had some bad experiences and developed a bad reputation for investment. Recently,  last year it declared it was going to pull out of its trade agreements (BIT's) with most countries, including the UK. This essentially removes protection for companies. We recently saw a terrible Mexico auction of its licenses and there is nothing to suggest that it will go much better for Indonesia.
At the end of the day until CEB tells investors what its investment will be, how its funded, what percentage of the deal it will keep (its already given away a chunk of anything) and importantly who will fund the exploration, its impossible to put a figure on the SP and its nothing more than a gamble. One the two Directors selling don't seem to want to take...

#AFPO is another one, where its impossible to justify the SP until we know the profit and figures from any deals. Take the profit and run IMHO.

Be careful out there folks.