My apologies

After my hedge fund meeting on the 7th, I vacillated over recommending a stock here on my blog. As you know, I don't do so lightly. The last one I recommended, Fastenal (FAST), has gone from $40 to $47 as of today and has been higher since I recommended it. A pretty good win by all accounts in this market.

So I was considering adding another stock to that list, Contango Oil & Gas(MCF). Eventually I opted to NOT put it on the site for a few reasons. The stock had gone from $23 to $82 and was the primary reason for the outstanding returns in my hedge fund. There was much discussion regarding this stock as it's over 50% of the $200 million fund. It was publicly known, but not well reported, that the company has set up a "data room" to start the process of selling the company's assets. A "data room" is exactly what you might think it is: a room full of data. However this data isn't just financial data on the company; it's data on all the oil and gas reserves and estimates of such from the various wells and land rights that they hold. When a company sets up their data room, they are serious about selling.

Well, like I said, it was public knowledge but the company has zero analysts following it. That's right, zero. Today, finally, the word hit the major news lines via a press release by the company and the stock popped up. We had discussed the then $82 stock price as being the low end of the sale range based on current natural gas prices. The high end was $110, though some speculated it could approach $120 in some optimistic scenarios. It is all based on the sale though and not on continuing operations. As such, there's an element of risk involved because deals can fall apart, egos can get in the way, all sorts of things can happen. Plus the deal could very well get done for $80 a share and you wouldn't gain anything.

So for all of those reasons I didn't write about it. With the press release today, the stock jumped $7.50 to almost $92 a share.

My apologies to all.