Free markets correct themselves, usually too quickly for an amateur to participate and, thankfully, too fast for government to interfere. Even when slow about it, markets do always right themselves eventually. So why, at press time, did Energy Partners Ltd.’s stock price continue to hold the elevated stature a late-August bid from Woodside Petroleum Ltd. gave it, although EPL has rejected the Woodside bid? Also unusual: Stone Energy Corp.’s stock price has remained in the tank. For those not following the story, Stone’s share price shouldn’t seem to have much to do with that of the others. Add this to the mix: Plains Exploration & Production Co. Fashionable today is the faux-mance (a brief fling the media or one party mistakes for a romance) and the bro-mance (pronounced with a long “o†and used, for example, to describe the friendship of Lance Armstrong and Matthew McConaughey). Recent dalliances with Stone are looking increasingly like a faux-mance very much involving some bro-mances. And, the continued lack of resolution could mortally crush Stone’s wounded momentum as an ongoing concern. Some background: Wall Street darling Stone Energy, which posted consecutive performance improvements for most of its years, ran into production-decline and reserve-writedown issues last year that were exacerbated by hurricane damage to cash flow. For more on this, see the October issue of Oil and Gas Investor. For a subscription, call 713-260-6441.
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