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"Motivated" Seller Whiting Petroleum Jumps Despite 1043x Forward P/E

Tyler Durden's picture




 

Whiting Petroleum - the largest oil producer in the Bakken shale formation - has caught some investors' (and TV talking heads) eyes this morning as it has jumped over 11% on speculation that its decision to put itself up for sale - as a "motivated" seller - somehow means the collapse in the share price will be reversed by some greater fool who sees "synergies." We wonder though... who exactly is going to buy this company that trades at a 1043x Forward P/E?

 

As Bloomberg noted Friday,

Whiting Petroleum Corp., the largest oil producer in the Bakken shale formation, has hired a bank to pursue a possible sale, people familiar with the matter said.

 

The Denver-based company, which has a market value of $5.7 billion, has reached out to potential buyers including Norway’s Statoil ASA, one of the people said, asking not to be identified as the information is private.

 

Whiting, which acquired Kodiak Oil & Gas Corp. for $3.8 billion last year, is searching for a buyer as the price of crude oil has fallen by half since July to about $50 a barrel. The company has been exploring the sale of its oil and gas processing assets in North Dakota, people with knowledge of the matter said last month.

And today the stock jumps... because who doesn't wnat to buy a company whose valuation is a mere 1043x Fwd P/E...

 

 

One quick question - what happens if no one wants to buy them? Two words... "massive repricing" of the entire sector. And do not forget, all of these companies have massivley exaggerated oil reserve valuation levels on their balance sheets.

 

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Mon, 03/09/2015 - 09:41 | 5869170 SethDealer
SethDealer's picture

I thought Continental Resources was #1 producer in Bakken ??

Mon, 03/09/2015 - 09:42 | 5869174 Headbanger
Headbanger's picture

Why all the fucking BTFD-tards here will buy it!

Mon, 03/09/2015 - 09:45 | 5869185 GetZeeGold
GetZeeGold's picture

 

 

Come on man.........let me in there!

 

 

MOM!!!

Mon, 03/09/2015 - 09:49 | 5869201 Beam Me Up Scotty
Beam Me Up Scotty's picture

The Fed could do it. Just hand them some freshly printed Benjamin's for their company. Done deal!!

Mon, 03/09/2015 - 09:51 | 5869211 cnmcdee
cnmcdee's picture

What a deal!!  Quick I gotta call Grandma maybe I  can get her to bet her life's savings on this one what a opportunity!!

Mon, 03/09/2015 - 10:15 | 5869282 SoilMyselfRotten
SoilMyselfRotten's picture
"Motivated" Seller Whiting Petroleum Jumps "the shark" Despite 1043x Forward P/E

 

There, fixed it

Mon, 03/09/2015 - 09:59 | 5869226 WillyGroper
WillyGroper's picture

Actually, I now think it's Hamm's Xwifey.

Mon, 03/09/2015 - 14:43 | 5870334 NESD
NESD's picture

CLR was until Whiting acquired Kodiak and jumped to #1 in North Dakota.

Mon, 03/09/2015 - 09:42 | 5869173 cossack55
cossack55's picture

Too easy. Cramer

Mon, 03/09/2015 - 09:42 | 5869176 astoriajoe
astoriajoe's picture

Yeah, yeah, PEs. But what do they get per click?

Mon, 03/09/2015 - 09:43 | 5869177 NoDebt
NoDebt's picture

That looks just like BitCoin at 1200 a year and a half ago.... before it collapsed.

 

Mon, 03/09/2015 - 09:46 | 5869188 headhunt
headhunt's picture

Only1043x Forward P/E?

That is a fraction of our Feds equivalent.

Mon, 03/09/2015 - 12:16 | 5869771 El Hosel
El Hosel's picture

....one of the big winners of the  energy Renaissance !

Mon, 03/09/2015 - 09:47 | 5869191 zappafan
zappafan's picture

Another one bites the dust - Dune energy just filed for bankruptcy after a merger deal fell through.  

 

 

Mon, 03/09/2015 - 09:47 | 5869193 Dubaibanker
Dubaibanker's picture

We have a buyer for this company....

Shrek Donkey Pick Me  

 

Mon, 03/09/2015 - 09:51 | 5869210 FuzzyDunlop21
FuzzyDunlop21's picture

log scale bitchez

Mon, 03/09/2015 - 09:53 | 5869212 Eastwood
Eastwood's picture

as crazy as it sounds, earnings isn't a popular metric for independent E&Ps.

Mon, 03/09/2015 - 10:00 | 5869228 Farmer Joe in B...
Farmer Joe in Brooklyn's picture

Correct you are.

But with total debt to EBITDA of ~4.4, it still looks like a fucking pig.

Mon, 03/09/2015 - 09:54 | 5869216 cnmcdee
cnmcdee's picture

We PEd on some folks..

Mon, 03/09/2015 - 10:00 | 5869230 allinwood
allinwood's picture

GM

Mon, 03/09/2015 - 10:02 | 5869239 WillyGroper
WillyGroper's picture

Jim Willie has on more than one occasion mentioned alt-energy with Toyota giving away patents on fuel cell tech.

Could it be, in reality that oil is getting scarcer & there's going to be a shift for those that can afford it?

Mon, 03/09/2015 - 11:41 | 5869598 El Hosel
El Hosel's picture

Oil will get scarcer after the biggest glut in history plays out.... Scarcer or bust.

Mon, 03/09/2015 - 10:02 | 5869240 Panic Mode
Panic Mode's picture

What a bargain!! Such an underrated P/E.

Mon, 03/09/2015 - 10:09 | 5869266 astoriajoe
astoriajoe's picture

when I bought my home, the agent said the seller was "motivated" and thought I could get a lower price.

Mon, 03/09/2015 - 10:13 | 5869275 pragmatic hobo
pragmatic hobo's picture

that's much lower than infinity ... buy!

Mon, 03/09/2015 - 10:17 | 5869287 Jethro
Jethro's picture

1043X forward P/E?  Did I miss the Rapture or something?

Mon, 03/09/2015 - 10:31 | 5869328 Hohum
Hohum's picture

Its earnings are positive?  Not for long, I bet.

Mon, 03/09/2015 - 10:38 | 5869349 Jano
Jano's picture

Haleluja Enron! Golden guy, this late Ken Lay! I do not want to be a bad ass, but 1043x? I cross my fingers, maybe it helps them to find quickly that stupid guy. Every investment is a risk, but these are cooked books.

Mon, 03/09/2015 - 10:56 | 5869405 GMadScientist
GMadScientist's picture

"Nice bag!"

Mon, 03/09/2015 - 11:06 | 5869441 I am a Man I am...
I am a Man I am Forty's picture

Private equity will jump in betting on a rise in oil in five years, if it doesn't...fuck it, other people's money.

Mon, 03/09/2015 - 11:32 | 5869550 chomu
chomu's picture

Who the fuck cares about earnings multiples when valuing an entire business? Seriously?

Mon, 03/09/2015 - 11:38 | 5869588 El Hosel
El Hosel's picture

Maybe the fed should buy it, they broke it.

Mon, 03/09/2015 - 11:44 | 5869610 El Hosel
El Hosel's picture

"Priceless"

Mon, 03/09/2015 - 11:46 | 5869622 El Hosel
El Hosel's picture

"Motivated" selling in gold stocks too, I see.

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