Famously named after the town in was founded in (Tullow, Southern Ireland) and for its meteoric rise from small local oil exploration company to now an international presence, having interests in over 25 countries with 67 producing fields is nothing short of spectacular.
However, once the darling of the stock market: moving higher from 250p in 2006 to 1611p in 2012, Tullow Oil (LONDON:TLW) shares have experienced the worst performance, even more so that the credit crisis of 2008/2009, with moving lower from 1200 to 480p in the last 2 years.
Many catalysts can be blamed for the negative performance: US Shale fracking, geo-political instability in the regions they operate or a generally lower crude oil price as a Chinese industrial slow down now looks possible. The plethora of negative news also coupled with their recent drilling success rate, notably down from their usual double the industry record of 74%.
But given the current relatively low market capitalisation of £4.3 billion and recent stabilisation in share price could we about to see a turn of fortunes for Tullow? The quality of Tullow’s assets are conspicuously high, mostly notable the Jubliee Oil field in Ghana.
Additionally, its area of expertise and operations in Africa, is a relatively undeveloped region the oil exploration sector has yet to galvanise any action on. As such, it wouldn’t be out of the question that these assets would sit perfectly with a national/sovereign oil company. Moreover, the number of broker upgrades, only last week, shows the tide could be turning on the sentiment of these shares.
Could the Time Be Right for Tullow? Absolutely.
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