Stock Guru Profile Universal Energy – Blog – News
Universal Energy (USVE) Shares Brewing a Breakout
While Q2’s high-volume rally from $1.10 to $2.55 for Universal Energy Corp. (UVSE) may have been a case of putting the cart before the horse, the slide from $2.55 all the way back to August’s low of 62 cents may have been equally errant. Such is the case when a relatively new issue makes its effective debut.
Now that all the initial volatility has played out, we find UVSE shares have been biding their time since late August, locked between 95 cents and somewhere around $1.27. This consolidation period has given the company a chance to ‘catch up’ with the chart. However, with drilling at the remaining three (of the nine) current prospects starting this past week, it appears as if the ‘catch up’ chase is nearing an end – if not already past that point. In fact, we believe this chart actually under-reflects Universal Energy’s drilling results to date.
During the consolidation phase, Universal Energy has continued to make measurable progress without yet impacting the chart. Specifically, on September 6th, a gas deposit was struck at the Amberjack project. On September 18th, Universal became a participant in the Lone Oak (Texas) prospect. On September 26th, the Caviar #1 prospect (Louisiana) was announced to be a proven reserve. On Thursday of last week, the company officially announced they’d begun operations at the final three sites…Lake Campo, W. Rosedale and East OMG.
Also on the long-range radar is the Nisku Reef Prospect, in Alberta, Canada. While the other prospects Universal Energy is working on will bear respectable fruit even with smaller interests in the project, the 95% interest in the Nisku Reef development could mean windfall is looming.
The stock – despite the wave of good news – has been content to tread water right around $1.00.
If the market is indeed waiting for news on the three wells started last week (as we think it may be), the inherent risk of doing so is being unable to find a relatively low entry spot (under $1.27) once any news is out. Nevertheless, a strong news-based move past $1.29 may still offer trade-worthiness. Remember, Kris Gupta, CFA for Equity Stock Analysis, has established a target of $2.45 per share based on a combination of proven reserves and anticipated near-term success with more recent prospects. As mentioned in his Equity Stock Analysis report, it is expected that UVSE will be “generating revenue from five wells before January 1, 2008, with additional revenue from four additional wells within the next one hundred and sixty days.”
That valuation is just as valid from a short-term technical perspective. UVSE saw highs at $2.55, and the market is likely to be collectively using that high as a short-term benchmark…and a potential selling point. An exit on the way up to said levels may be easier to make than on the way down.
Longer-term, once those remaining four wells start to yield, the valuation could climb even higher. Using Fibonacci extension lines (not shown this time), a 100% extension past (above) $2.55 from that prior peak to the low of $0.62 would leave shares at $4.47. That’s just a hair lower than another recent research report target of $4.56, based on all nine current prospects going into production.
Listen to the UVSE CEO AND CFO:
Billy Raley spoke with Stock Guru and explained the overall business model and plan of UVSE:
Dyron Watford spoke with Stock Guru and explained each prospect and what it means in terms of cash flow.
The best may be yet to come!
CONTACT:
Universal Energy Corp.
Billy Raley, CEO, (800) 975-2076
braley@universalenergycorp.info
Email: Dyron M. Watford, CFO – dwatford@universalenergycorp.info
Website: www.universalenergycorp.info
30 Skyline Drive
Lake Mary, FL 32746
Phone: (800) 975-2076
Fax: (800) 805-4561
Source: Universal Energy, Reuters, Wall Street Journal, Bloomberg
About Universal Energy Corp. Universal Energy Corp. is an energy company engaged in the acquisition and development of crude oil and natural gas leases in the United States and Canada. We pursue oil and gas prospects in partnership with oil and gas companies with exploration, development and production expertise. Our prospect areas consist of lands in Alberta, Canada, Louisiana and Texas. Visit www.universalenergycorp.info for more details.
Safe Harbor Statement: All statements, other than statements of historical fact, included in this press release are forward-looking statements within the meaning of the private securities Litigation Reform Act of 1995. The forward-looking statements, including statements about the company’s future expectations, including future revenues and earnings, and all other forward-looking statements (i.e., future operational results and sales) are subject to assumptions and beliefs based on current information known to the company and factors that are subject to uncertainties, risk and other influences, which are outside the company’s control, and may yield results differing materially from those anticipated. The Company makes forward-looking public statements concerning its expected future operations, performance and other developments. Such forward-looking statements are estimates reflecting the Company’s best judgment based upon current information and involve a number of risks and uncertainties, and there can be no assurance that other factors will not affect the accuracy of such forward-looking statements. It is impossible to identify all such factors but they include and are not limited to the existence of underground deposits of commercial quantities of oil and gas; cessation or delays in exploration opportunities being fewer than currently anticipated. Factors which could cause actual results to differ materially from those estimated by the Company include, but are not limited to, government regulation, managing and maintaining growth, the effect of adverse publicity, litigation, competition and other factors which may be identified from time to time in the Company’s public announcements and filings.
Disclosure: Pentony Enterprises LLC has been compensated $215,000 by the company for profile coverage. Pentony Enterprises is not a registered investment adviser or a broker/dealer. Pentony Enterprises LLC makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. Pentony Enterprises has acquired 15,000 shares in the open market and will hold these shares for at least 30 days from the date of acquisition.
StockGuru.com is owned and operated by Pentony Enterprises LLC, 9555 Lebanon Road, Suite 103, Frisco, Texas 75035. Telephone: (469) 252-3030. Web: StockGuru.com. Email: Publisher@stockguru.com .