Enquest
Shares in Enquest (LSE: ENQ) are up by as much as 9% today after the company announced that it has withdrawn from its investment in the Didon oil field and Zarat permit in Tunisia.
This investment had originally come about in May 2013 when Enquest agreed to buy interests in the two prospects from PA Resources, with the total amount for the Didon field ($23m) being held in escrow until such a time as the Tunisian authorities had approved the deal. However, the deadline for this has now passed, and so the money has been returned to Enquest and the stake returned to PA Resources.
The development means that Enquests full year production is set to be 372 bopd lower than previously anticipated, although this makes only a small difference since Enquests production is around 28,000 bopd. It is still forecast to make a loss in the current year and, even though its share price is up 9% today, it is 71% down in the last year, with a weaker oil price hurting investor sentiment significantly.
Looking ahead, Enquest is expected to return to profitability next year, although with it trading on a forward price to earnings (P/E) ratio of 21.2, much of this turnaround seems to be priced in. As such, it could be worth waiting for a keener valuation before buying a slice of the business.
Tullow Oil
Shares in Tullow Oil (LSE: TLW) are also up 9% today after rumours emerged that oil major, Shell, may be mulling over a bid for its smaller rival. Clearly, there is no proof that this is the case: it is merely a rumour, but Tullow does seem to be somewhat appealing at its current price level.
For example, it currently trades on a price to earnings growth (PEG) ratio of just 0.2, which indicates that it offers growth at a reasonable price. And, although it has shifted its strategy somewhat and is now more focused on production as opposed to exploration that it was in the past, it remains a more nimble and adaptable entity than Shell, which could prove to be an attractive attribute for its larger peer.
And, even if a bid doesnt materialise, Tullow Oil still seems to be an attractive play. Certainly, its future depends to a large extent upon the price of oil, but its strategic shift and impressive forecasts make it a company that could see its share price rise significantly after a twelve-month period when it has slumped by almost 50%.
Of course, Tullow Oil isn’t the only oil stock that could be worth buying. However, it can be tough to find others when work and other commitments get in the way.
That’s why the analysts at The Motley Fool have written a free and without obligation guide called 10 Steps To Making A Million In The Market.
It’s a simple, straightforward guide that could help you to unearth the best stocks at the lowest prices. As such, it could give your portfolio a boost and help make 2015 an even more prosperous year for your investments.
Click here to get your copy of the guide – it’s completely free and comes without obligation.
Get FREE Issues of The Motley Fool Collective
Get straightforward advice on whats really happening with the stock markets, direct to your inbox. Help yourself with our FREE email newsletter designed to help you protect and grow your portfolio wealth.
By providing your email address, you consent to receiving further information on our goods and services and those of our business partners. To opt-out of receiving this information click here. All information provided is governed by our Privacy Statement.
Peter Stephens has no position in any shares mentioned. The Motley Fool UK has recommended Tullow Oil. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.