HCLP: Searching for a bottom, but possible opportunity soon!
HCLP is a solid company that is currently struggling with a few significant market-wide headwinds, but if the price can find a bottom around $4, it may soon provide a very good buying opportunity.
Pipeline capacity limits and the overall bearish attitude toward the oil industry are weighing heavily on frac sand producers, but Wall Street may be overreacting as everyone flees from this sector.
A combination of factors including book value and analyst expectations put the value of this stock at $10-$14 per share, so buying around $4 and selling in the $7-$9 range makes this one a decent bet, if you are willing to hold for 6-12 months.
Pipeline capacity limits and the overall bearish attitude toward the oil industry are weighing heavily on frac sand producers, but Wall Street may be overreacting as everyone flees from this sector.
A combination of factors including book value and analyst expectations put the value of this stock at $10-$14 per share, so buying around $4 and selling in the $7-$9 range makes this one a decent bet, if you are willing to hold for 6-12 months.
Comment:
We witnessed a solid bounce on the news of a partnership with Chesapeake, but i believe we are still searching for a bottom formation around $4. I am setting buy orders just above and below that range, hoping to catch one last panic dip in the next month or so. I believe we still need 1-2 positive earnings reports from this company (and others in the sector) before we really start to see a sustained upswing in the price of this stock.