Anadarko Petroleum Corp (NYSE:APC)

Nothing too differentiated - a good company in a good position with a CEO who likes to sell his companies.

They are an excellent oil & gas company. They are aggressive and have successfully positioned themselves to benefit from several huge finds.

Strong success in drilling plus Macondo won't cost as much as expected.

Oil

long E&P firms and nat gas

oil price up

Paulsen 7.8 m share buy last quarter

i want option article, call or put

Great company in a vital industry. Growth is a given.

will be a take over very soon, 30 to 60 days......ozzz

There will soon be an oil pick. Luckily this company image wasn"t as badly damaged than BP
outperform

Can go down a little more because of the BP fiasco but will go above $70 a share within 3 mos. 11/1/2010

Alright, couple of reasons I'm marking this as outperform, none of them related to the specific company at hand. Typically, about twice a year, I'll go to the finviz heatmap:

http://finviz.com/map.ashx?t=sec&st=ytd

From there I'll check the trending 6 months, 1 year, and YTD to find lagging sectors.

Once I find the lagging sectors, I'll do a quick analysis of the macro variables at hand and determine whether the secto is warranted to be under performing the market or whether I think the market has undervalued these sectors. In this case, I think O&G exploration and development as well as utilities are undervalued.

If you notice, pharmas are also undervalued, but I think the new healthcare law makes their underperformance relevant at this time - if they continue to be undervalued at the time of my next review, I may pick up some in the sector.

I digress, the reason I think O&G and utilities are a good buy at this time:

1. Winter is fast approaching
2. Energy prices are still comparatively low and will go up
3. The economy is rebounding
4. The oil spill worries are becoming something of the past for the majority of Americans (Personally, I hate that recency plays a factor in this at all)
5. Likely republican majority in one chamber will make it difficult to pass major energy reform, thus old energy wins and new energy loses. (Much to our malevolence)

After I determine which sectors to buy, I'll review each individual stock in CAPS. Anything less than 3 stars gets filtered out. 4 and 5 star picks are most preferable, as these quintiles usually gains points in a year's time.

I expect to remove 90% of these stocks by March/April. Typically, this nets me a few hundred caps points (read: profit), and roughly 75% accuracy. Some will be bombs or laggards. Those that barely lag will be kept on my portfolio in hopes that I may eke out a slight gain at a later date. The bombs will be dropped.

I want to emphasize, this is not a judgment call on this specific stock. I didn't even check the financials. Do your DD if you buy in RL. In fact if you like the sector and want to buy in RL, I recommend you buy a sector ETF - one of my personal faves is FCG.

Forbe's article talks about call activity and speculation of BHP takeover.

http://www.forbes.com/2010/09/02/anadarko-petroleum-mariner-explosion-markets-options-costco.html?boxes=marketschannelnews

I just bought a couple calls .... maybe I'll get lucky!

I was looking at the pitches for APC and I noticed that the top red thumb pitch is from 2007 and just says "56". Obviously that person is not playing around in CAPS anymore or they would've closed out that pick a while ago. But it made me think that if that is the best that anybody can do to point out how bad of an investment APC is over the last three years, then that is a glowing endorsement for how good of an investment APC is. I am currently up 45 points and I've only had this pick a month and a half. I was looking into the possibility of ending this pick, but I have decided due to the lack of any negatives, I will continue to hold it for a while longer.

outperform

I suspect that Representative Ed Markey's ammendment today (which was approved by the way) to make renegotiation of old federal leases a pre-condition of bidding new leases will gain traction and will disproportionately harm APC.

Call it speculative at this point, but I have a strong sense that the provisions of this ammendment are likely to be applied retroactively.

The cost will total well into the billions and it will effectively be a one-time wind fall tax. Operators will have the choice of either paying the fine or getting permanently locked out of the Gulf waters for perpetuity. I think they'll pony up and pay the tax.

That's one ambitious ultimatum, but I think Gulf area voters will embrace the idea as will federal budget hawks. Nothin' like a good old fashioned shake down. In this case, I actually think it's called for, though. In hindsight, the circumstances and terms under which these leases were granted and their unfairness relative to all other leases on the books are pretty egregious. I think the zero royalty leases are going to get rolled back across the board and that's really going to hurt this stock.

The mere prospect of this is certainly going to weigh heavily on the minds of the larger shareholders in this company beginning like tomorrow, and that's going to be terrible for the sentiment around the stock going forward.

Balancing the budget requires taking away from somebody, though. If the administration doesn't have the mandate to compel them to contribute to the BP damages fund, they'll be sure to get their pound of flesh some other way. This is beginning to look like their preferred medium of choice.

spill costs should be priced into this unless they decide to screw investors.

They will escape thevortex of BP and eventually right themselves. Back to 55 by year's end and gradually higher.