Aurelian Update - AULready Up Significantly

http://www.aurelianoil.com

This article is a follow-on from the below post. For full context and information, read the below article first:
http://www.theel1tetrader.com/2012/09/aurelian-bargain-buy.html


The blog recently highlighted Aurelian Oil and Gas (LSE:AUL) in mid-September as having significant potential to re-rate in following weeks due to its undervalued fundamentals and strong technical position. The review was issued when Aurelian was trading at 7.50p/share having made an ultimate closing low at 7.25p/share a couple of days prior. Today, the share price of Aurelian stabilised multiple times at 12.50p/share equating to a huge 67% increase. The share price peaked at 13p/share prior to closing at 11.75p/share. So what has changed since?


An updated share chart for Aurelian is shown above. A purchase at current prices may be on a spike as RSI levels are very high plus the share has been on a recent bull run. However, the share finished ~10% off the highs made today which indicates that a further small rise may be possible.

Since the initial review, Aurelian has released only one regulatory news statement. Thus some of the rise is accountable to one of two ideas; stakebuilding by institutions or speculation. It is clear from what has been released via RNS that the cause of the rise is the former despite almost 91% of the total shares in issue already being owned by institutions at the time of the first article. Since then, institutions have engaged in multiple transactions including the following:

- Capital Group reducing their stake
- Renaissance Group increasing their stake significantly before reducing a portion
- Barclays increasing their stake by over 1m shares
- Toscafund taking their stake to 27.8% by adding ~29m shares
- Cheyne Capital, Ingalls & Snyder, and 55 North Capital increasing their stakes

It is probable that some institutions may looks to reduce their interests in Aurelian upon the current rise, and that some of this has taken place over recent days. Although this is likely to be the case, it is perceivable that another institution may be looking to increase their holding. Both Toscafund and Cheyne are possibly doing this. With even more share being removed from the market, news could send Aurelian up quickly.

The one corporate RNS Aurelian has released refers to their Interim Results. The cash balance stood at the equivalent of ~£41m. Aurelian's market capitalisation has since moved to a more reasonable level of £58m, although this still undervalues their assets. The H1 loss was 4.5 million euros. The operational highlights were as follows:

- Farm-out for Siekierki ongoing with multiple parties
- Planned completion of 2D seismic in Q4 2012 at West Karpaty
- East Karpaty well to be drilled in 2013 so it can be farmed out for 40%. A farmout could generate and prove real value for Aurelian's licenses plus add to their cash pile

CEO Rowen Bainbridge commented: "The interim results indicate that we are well-capitalised for the future programme. We continue to make good progress on our Siekierki appraisal plan, and maturating the prospectivity within our portfolio; we are also taking steps to control costs and are pleased that all our 2012 operational activities have been achieved within budget. Progress on the strategic options review has been encouraging, and we intend to announce our recommendation before the end of the year."

Current traders of Aurelian may see it beneficial to reduce holdings in tandem with a likely share price spike. In the medium-run a large retrace may present a good opportunity to take a stake. Well done to Aurelian holders.

UPDATE: Aurelian has delisted following a merger with San Leon Energy (LSE:SLE). See the San Leon article for details

10 comments:

  1. Much better recs that TWin

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  2. 46% profit for me all thanks to your heads-up post!

    will spread the word

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  3. Thanks for the tip, made a lot of profit thanks to your research and review.

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  4. you are an excellent tipper keep it up!!!!!

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  5. I will tell you what has changed, AUL is in correction mode and about time!

    Furthermore, with the ban on short selling, the latter has help many other stocks too!

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  6. AUL is in correction mode and about time!

    Furthermore, the ban on short selling has helped Aurelian and many other stocks too!

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  7. good timing el1tetrader

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  8. Seems that the spike was caused by a bit of manoeuvring by some of the bigger holders. I think the big push will come until sometime after the long awaited report is published.

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