Article about JPM's ERROR on its downgrade on ATPG days ago

Haha, I am really going to be a little richer tomorrow, it is going to be fun, really fun tomorrow. Read the following post copied from yahoo, unbelievable. I guess job for JPM analyst is just like job for me at computers, no passion and error prone:

http://www.scribd.com/doc/34397260/ATPG-Correction

Here is a quick article I will send out everywhere tonight. You can use it anyway you want--drop drop my name and use yours. Thanks, Devon

Tuesday, the 13th of July, JPM analyst, Joseph Allman issued a downgrade for ATPG stock, based on his calculations that the Texas-based oil company needed to raise another $500,000,000 before it could generate free cash flow in 2012. The stock price tumbled from the mid-$10 range into the high $8 range two days later. Now a correction has been GENTLY issued stating that Mr. Allman made an error: a $450,000,000 ERROR and issued a retraction.

This is egregious and deserves equal press and air time.

Dr. Devon Blake

Here is the correction, followed by the two news stories (elided) that started the stock price to plunge:

On Tuesday, July 13, we published a note on ATPG titled, “Trading at a Premium; Financing Needs Likely Greater Than Market Thinks; Downgrading to Underweight.” In that note we made an error of approximately $450MM in our calculation of ATPG’s financing needs:

Double counted re-payments for overrides and net profits interests:
We model ATPG’s overrides (ORRIs) and net profits interests (NPIs) and attempt to calculate the cash flow impact of these financial transactions. ATPG re-pays a principal portion and an interest
portion for these financings. We double counted the principal portion of
repayments for years 2010 and 2011. The magnitude of this error is around $450MM.

Adjusted model for error:
The attached model adjusts for the above mentioned error. In our July 13 note, we stated that it appeared that ATPG would need $500MM of external capital. This model corrects that error and reduces that need to $50MM.

Link to Correction: http://www.scribd.com/doc/34397260/ATPG-Correction


Original story on Market Watch on July 13th (By Cynthia Lin):

NEW YORK (MarketWatch) -- ATP Oil & Gas Corp. (ATPG 10.40, +0.28, +2.77%)

Shares fell 6.7% to $9.73 Tuesday after analysts cut the company\'s rating and price target, seeing lower oil production than ATP\'s guidance and additional funding needs. Jefferies cut the oil producer\'s price target to $10 from $17. In a note, the analyst cited production delays and elevated future operating risk coming out of the Gulf oil spill. He expects ATP to generate 8.5 million barrels of oil equivalent in 2010 versus the company\'s own projection of 9 million to 10 million barrels. Separately, J.P. Morgan downgraded ATP to underweight from neutral, pointing to current trading premiums and financing needs likely greater than market thinks. J.P. Morgan\'s Joseph Allman estimated that ATP would need to raise another $500 million before generating free cash flow in 2012. He kept his price target at $10 a share.

http://www.marketwatch.com/story/atp-oil...

Also from the Associated Press on Tuesday July 13, 2010, 12:54 pm EDT
NEW YORK (AP) -- Shares of ATP Oil & Gas Corp. slid Tuesday after a JPMorgan analyst downgraded the company, saying it would likely need to raise more money than expected, while a Jefferies analyst slashed his price target because of production delays in the Gulf of Mexico...

...Meanwhile, Jefferies analyst Biju Perincheril cut his price target by 41 percent to $10, saying a government moratorium on deep-water drilling will delay production and the company could have to deal with tougher regulations after the moratorium expires.

ATP was not immediately available for comment Tuesday afternoon.

SHARE ACTION: Shares fell 68 cents, or 6.5 percent, to $9.75 in afternoon trading. They have ranged from $5.68 to $23.97 in the past 12 months.

http://finance.yahoo.com/news/ATP-Oil-Ga...