Good write up you have a new subscriber - appreciate the attention, have owned and followed FET since 2020.
I'd just clarify that the only debt outstanding is the $100MM notes just issued and the line of credit balance, everything else was cleared with the closing of the new notes (they paid off the 8/2025 and a variperm seller note) - net debt was $199 at 9/30, $179 post sale/leaseback.
I think an important part of this story is why did the stock go from low $30s in early 2023 to $14 this year despite EBITDA 2.5x and op CF from (17MM) in 2022 to +60-70MM in 2024?
The conversion of ~50% of their notes triggered right at the end of 2022, this put an extra ~4.5mm shares on the market, the variperm transaction created another 2 million. You can look through the filings but the largest PE holder sold 830k shares in Q4 2023 2H 2024 volume was nearly 2x 1H 2024 volume), large bond holders sold throughout 2023 & 2024.
The stock has been fighting exit liquidity which is not fundamentally driven. It feels like 12/31/2024 was a turning point. Anyone selling to clear shares from YE statements is gone (it seems).
Agreed on all your analysis - setting the floor here into what is an improving macro environment driven by power demand is the perfect multi-year setup as OFS activity troughs. Thanks
I think FET has faster torque and nearer catalysts. But Seadrill is a much more established company with less debt burden. Seadrill would be the lower risk of the two and FET the higher risk. Maybe my degeneracy is showing, but I would put a marginal dollar to work in FET before Seadrill
Thanks. I added a lot to my noble position after it dropped below 34 and now have about 12% of my individual stock portfolio in noble (6%) valaris (4%) and seadrill (2%) and am debating if I should swap seadrill for something else or just let it ride and add a little to valaris.
Good write up you have a new subscriber - appreciate the attention, have owned and followed FET since 2020.
I'd just clarify that the only debt outstanding is the $100MM notes just issued and the line of credit balance, everything else was cleared with the closing of the new notes (they paid off the 8/2025 and a variperm seller note) - net debt was $199 at 9/30, $179 post sale/leaseback.
I think an important part of this story is why did the stock go from low $30s in early 2023 to $14 this year despite EBITDA 2.5x and op CF from (17MM) in 2022 to +60-70MM in 2024?
The conversion of ~50% of their notes triggered right at the end of 2022, this put an extra ~4.5mm shares on the market, the variperm transaction created another 2 million. You can look through the filings but the largest PE holder sold 830k shares in Q4 2023 2H 2024 volume was nearly 2x 1H 2024 volume), large bond holders sold throughout 2023 & 2024.
The stock has been fighting exit liquidity which is not fundamentally driven. It feels like 12/31/2024 was a turning point. Anyone selling to clear shares from YE statements is gone (it seems).
Agreed on all your analysis - setting the floor here into what is an improving macro environment driven by power demand is the perfect multi-year setup as OFS activity troughs. Thanks
Thank you and welcome!
Seen you have a mention on Yahoo Finance. Hopefully it brings you more subscribers and we can still get a position in FET now. haha.
https://finance.yahoo.com/news/forum-energy-technologies-inc-fet-172723238.html
Yeah, there are a few platforms that aggregate these writeups. I'm happy for the expanded reach, they provide a link to the substack.
Would you rather own Seadrill or FET?
I think FET has faster torque and nearer catalysts. But Seadrill is a much more established company with less debt burden. Seadrill would be the lower risk of the two and FET the higher risk. Maybe my degeneracy is showing, but I would put a marginal dollar to work in FET before Seadrill
Thanks. I added a lot to my noble position after it dropped below 34 and now have about 12% of my individual stock portfolio in noble (6%) valaris (4%) and seadrill (2%) and am debating if I should swap seadrill for something else or just let it ride and add a little to valaris.
pardon me if i'm in error but it looks like you reversed some ratios. i.e. if fcf is $50-60mm and market cap is $234 mm then the cap is ~4x, not 25%
Yeah, I usually write it as a multiple. Management wanted to present information in terms of free cash flow yield. Apologies if that was confusing.
Thank you for the mention and getting the stock some attention. I appreciate it!
Great write up and research on your page too. 👍🏼
Thanks Adam, I appreciate it!
love it. hope you get this to $80+