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CEI

CEI: A Hugely Underpriced Small Float Player in the Roaring Oil Patch


Date : November 8, 2017

CEI: A Hugely Underpriced Small Float Player in the Roaring Oil Patch

New Opportunity:  Camber Energy Inc. (NYSE American: CEI)

Today’s newest pick doesn’t take a rocket scientist to understand. And it looks like a great way for us to nail our 8th straight big money shot this Fall.

The stock is a strong emerging player in the independent oil and gas space with real proven reserves, new cash on hand, strong production, massive top-line growth, and efficient management team, a small trading float, and potential bullish base in formation on the chart. Oil has been screaming higher, recently breaking out to new 2-year highs. Oil stocks have been following suit.

CEI looks primed to follow the heard and break out on the upside if all proceeds as we expect. Check it out!

Symbol:  CEI

Company:  Camber Energy Inc.

Quote:  http://finance.yahoo.com/q?s=CEI

Latest News:  http://finance.yahoo.com/q/h?s=CEI+Headlines

Company Website:  http://www.lucasenergy.com/

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Who is CEI

Camber-Energy-Inc-CEI-Stock-News

Camber Energy Inc. (NYSE American: CEI) is an independent oil and natural gas company that engages in the acquisition, development, and sale of crude oil, natural gas, and natural gas liquids in Texas and Oklahoma.

The company holds interests in approximately 13,000 net acres in producing fields located primarily in the Hunton formation in Lincoln, Logan, and Payne Counties, central Oklahoma, as well as in the Cline shale and upper Wolfberry shale in Glasscock County, Texas; and 3,600 net acres in the Horizontal San Andres play on the Central Basin Platform of the Permian Basin in West Texas under a joint venture agreement.

As of March 31, 2017, its total estimated proved reserves were 5.6 million barrels of oil equivalent. The company’s notes suggest that this comes potentially in the form of 1.6 million barrels of crude oil reserves and 4.0 billion cubic feet of natural gas reserves.

The company’s materials also cast this firm as “a growth-oriented, independent oil and gas company engaged in the development of crude oil, natural gas and natural gas liquids in the Hunton formation in Central Oklahoma in addition to anticipated project development in the San Andres formation in the Permian Basin.”

The company has suffered from a poor energy pricing environment, but has shown major growth, bringing in over $5.3M on the top line on massive sales growth of more than 2,200% on a quarterly y/y basis.

This put the company on our radar because we have been in-house oil bulls since this summer due to a lack of exploration activity over the past two years, a recent acceleration in nominal global economic growth, and over-hedging by US shale oil producers.

The Oil market has been on fire of late, launching nearly 30% in the past 8 weeks. Nat Gas has started to run higher as well over recent days. This company has proven reserves that are meaningfully increasing in value, which is something the market has not been reflecting.

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Recent Catalysts

Another key part of the narrative here is the company’s recent massive raise of working capital. Through a key institutional investor, the company executed a stock purchase agreement that should provide for as much as $16M in new funding. Note that the price it will make on each unit of production is rising rapidly right now as energy commodities are breaking sharply to the upside and have strong conditions in play. That means, it is an advantageous time to invest in increasing production.

It’s what we call a “high-ROI context”.

Following that, the companyannounced updated production goals, which makes sense because now they have sound financial footing and a high-ROI context. So we would expect them to invest in aggressive growth of output.

In that vein, the Company has begun topowerfully increase production and reopen wells and push, push, push. This is a good thing. Bigtime.

Finally, and most recently, we just got some production numbers. The big story is this:actual recompletion costs are approximately 45% below estimates, while production levels are significantly above projections for the company’s 5th well. The 6th, and final well in the field, should be completed within the next few days, commencing production in the immediate term.

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All of this is wrapped in the main catalyst, which is the continued run higher in energy commodities. Propane prices, nat gas prices, crude oil prices. All of it has been running higher. And the reason for this is economic growth mixed with the hit to derivative product inventories that was caused by hurricane Harvey hitting the eastern coast of Texas in late August. That shut down over 33% of the US refinery base, which drew down inventories of refined products to practically nothing.

We have been working to rebuild those inventories ever since. But simple demand has been making that process more difficult because economic data has been powerfully improving, driving more usage of energy resources to power more plants, cars, trucks, planes, machinery, factories, etc.

Technical Analysis

The stock has a beautiful chart coming together right now. The grinding bearish trend appears to have given what over the summer to a basing pattern that is coming on much higher volume. We can also see a clear double bottom with support now in place in the $0.14-0.16 zone.

This stock is trading on a small float of just around 25M shares, which suggests it’s light to lift if a little buzz or buying interest starts to build. We can also see a positive indication right now from the MACD indicators, showing that momentum is starting to turn from down to up under the surface of this pattern.

With a stock like this, we also need to think about the technicals underlying energy markets. Crude oil is perhaps most important. Our read of the Crude Oil chart is very bullish right now, with oil futures breaking out of a two-year range to new 28-month highs on Friday, and already extending that move so far this week.

CEI.Chart

About CEI

CEI (Camber Energy Inc.) is an independent oil and natural gas company that engages in the acquisition, development, and sale of crude oil, natural gas, and natural gas liquids in Texas and Oklahoma.

The company holds interests in approximately 13,000 net acres in producing fields located primarily in the Hunton formation in Lincoln, Logan, and Payne Counties, central Oklahoma, as well as in the Cline shale and upper Wolfberry shale in Glasscock County, Texas; and 3,600 net acres in the Horizontal San Andres play on the Central Basin Platform of the Permian Basin in West Texas under a joint venture agreement.

As of March 31, 2017, its total estimated proved reserves were 5.6 million barrels of oil equivalent. The company’s notes suggest that this comes potentially in the form of 1.6 million barrels of crude oil reserves and 4.0 billion cubic feet of natural gas reserves

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Key Points:

  • CEItrades on a small float of just about 25M shares, which suggests overhead supply will be light on any new influx of buying interest.
  • CEI is making real money, with trailing revs already coming in at $5.3M.
  • CEI is starting to see major topline growth, with quarterly y/y revs increasing at 2226%.
  • CEI just raised a huge amount of working capital through a stock purchase agreement, and has already started to invest in expanded production.
  • CEI in the energy patch, where pricing for commodities has been ripping higher, with Crude Oil launching over 30% in the past two months, and breaking out to new 28-month highs in recent trade.
  • CEI just recorded a MACD Bullish reversal, suggesting a technical change in trend.
  • CEIalso just reported that production has been picking faster than expected after a 45% undershooting on costs. The company is making the dolla holla.

Conclusion

CEI has been left in the junk pile by market participants over the past year. It’s no secret that everyone has been hating on smaller oil and gas names over the that time. But new life is starting to pour into the sector, with commodities finally shaking off the crust of a 3-year oil bear market and breaking out to the upside.

CEI has a small float, huge top-line growth, new fresh capital, expanded production, and plenty of proven reserves still in the ground. The basing pattern on the chart could be a huge signal of big things to come for this stock.

Disclaimer :

We do not advise any reader take any specific action. Losses can be larger than expected if the company experiences any problems with liquidity or wide spreads. Our website and newsletter are for entertainment purposes only. MyBestStockPicks engaged in the business of marketing and advertising companies. All content on our website is for informational purposes only and should not be construed as an offer or solicitation of an offer to buy or sell securities. Neither the information presented nor any statement or expression of opinion, or any other matter herein, directly or indirectly constitutes a solicitation of the purchase or sale of any securities. Neither the owner of Our Newsletter nor any of its members, officers, directors, contractors or employees are licensed broker-dealers, account representatives, market makers, investment bankers, investment advisors, analyst or underwriters. Investing in securities, including the securities of those companies profiled or discussed on this website is for individuals tolerant of high risks. Never invest purely based on our alerts. Gains mentioned in our newsletter and on our website may be based on end-of-day or intraday data. This publication and their owners and affiliates may hold positions in the securities mentioned in our alerts, which we may sell at any time without notice to our subscribers, which may have a negative impact on share prices. If we own any shares we will list the information relevant to the stock and number of shares here. Mybeststockpicks owns no shares of any of the companies mentioned here within, nor intends to buy any in the future. Mybeststockpicks has been compensated total of two thousand dollars by ALG Financial to perform 1 week investors awareness advertisement on CEI

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