r/valueinvesting
Sable Offshore Corp (SOC) , what’s your strategy
Re-entered SOC at $15 citing strong asset base, Chevron partnership, and potential short squeeze despite recent price drop.
- Strong fundamental backing with $10B in assets and strategic partnership with Chevron for oil offloading.
- High short interest creates potential for a significant short squeeze in the near term.
- Positive regulatory outlook with supportive judge sentiment and recent visits from political figures.
- Significant volatility and drawdown from previous highs indicate market skepticism or execution risks.
- Reliance on legal hearings and political factors introduces binary event risk rather than pure operational growth.
Hello Guys , I have gone from holding sable at 7 dollars and selling it at 9 dollars a share. I have again started a position at 15 dollars a share and as you might have noticed, it’s been throughly beaten down recently (touchwood). The thesis still holds well and there is going to be a hearing today . Does anybody have any idea on this ? The judge seems to be on the side of sable. The trump officials have also visited the company recently. Chevron is buying its barrels and they also released an investor presentation on june 1 . 10 billion dollars of assets and a good oil situation. What are u opinions on this ?
As there is a lot of short interest on the stock, if theres a squeeze, we might see a lot of uptick in a span of 10 days
Two things to be aware of with Sable. The CEO is a real slimeball. Sable will only do well if the Trump administration allows it to.
These things do not mean it is a bad investment but it has risks that are basically impossible to measure.
Patience.
Great advice , waiting for todays hearing result!! Been holding bag since a long time
Just keep in mind that the higher cost basis you enter, the higher risk you take. I'm optimistic, but SOC is still high risk. I would avoid options on this also.
Ya i dont have options , in fact i never trade in options . Cost basis is around 14 dollars a share
Been buying from 4 to 14, cost basis of 10.
Personally I think anybody betting against this company at this point is nuts.
Even with the past dilution.. current market cap is 2 billion while they have 6 billion in PV10 reserves. ExxonMobil is 600B MC with 200B in reserves.
The emergency order was huge. Basically ensures that they now have a pathway to profitability. And even if it is rescinded it will not be until they have their debt refinanced and are well towards an offshore terminal to sell oil directly to the Asian pacific markets which now (thanks to the Iran war) are hurting the most.
On their recent investor call they outlined their strategy to not only build that terminal but also reopen another platform and implement a hedging strategy which will help them safely capture oil price upside. Their production cost after another year will be around $11 per barrel while oil is at $100 with every country releasing unprecedented amount of strategic reserves to suppress the price.. even still inventories are at critical levels.
I do not see how the stock is still where it's at but I also don't see how oil in general is still where it's at. Personally I think these markets are highly manipulated at this point but anyway, this stock meets all the value investing metrics to be $24/share easily. The only argument to be made against it is the lunacy of California but even they will not have the luxury of being lunatics once their gasoline starts approaching $10/gal.