Its shares may have doubled over the past 12 months, but Maverick Drilling & Exploration (ASX: MAD) has transformed itself from emerging producer to speculative explorer.
I recently received a call from one of our subscribers asking if I could recommend some speculative stocks for his portfolio.
I understand the lure of the quick, big win. It’s exhilarating. Uplifting. Muscle-building. Wealth-creating. The world’s biggest, best and easiest money making machine.
Last year, I experienced it first hand in a company called Maverick Drilling & Exploration. Long-term Motley Fool readers may have heard of it.
The short story is, on the back of a massive increase in its proven (1P) oil reserves, in the early part of last year, the share price went totally MAD…jumping from the low 20 cent level up as high as $1.50.
Happy days for investors like me who bought in at around 25 cents. Happier days when I took our own advice in Motley Fool Share Advisor and twice banked some part-profits at around $1.30, at the time a call which was unpopular in some circles.
Today Maverick shares languish back around 56 cents, a far cry from the heady days of close to $1.50.
I’m still a holder of Maverick today. I’m a happy holder too, given I’m still sitting on a double in the last 12 months, and I’ve taken some profits at what I thought was an artificially elevated share price.
Tempting yet idiotic
A few weeks ago I wrote about Maverick, saying an investment in them was both tempting and idiotic. It’s fair to say the company would not make the Scott Phillips’ cut as a ‘best of the best’ pick.
Over the past 12 months, Maverick has gone from a small emerging oil producer to a somewhat larger and more speculative oil exploration company.
Growing oil reserves can get you so far, but ultimately the market, and shareholders, need to see the money, see the reserves translated into cold hard cash.
I continue to wait, watch and hope.
The Australian Financial Review says “good quality Australian shares that have a long history of paying dividends are a real alternative to a term deposit.” Get “3 Stocks for the Great Dividend Boom” in our special FREE report. Click here now to find out the names, stock symbols, and full research for our three favourite income ideas, all completely free!
The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Motley Fool General Manager Bruce Jackson owns shares in Maverick.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
- Leading investment bank says US shares could fall 10%, something that could have serious implications for the ASX 200 index – July 9, 2020 1:18pm
- ASX 200 follows Wall Street higher | Have we passed the bottom? | Recovery will be brutal | ASX stock of the day hiding in plain sight – April 23, 2020 12:42pm
- Top fund manager is finding “an abundance of growth opportunities” outside the hot ASX tech stocks – September 19, 2018 3:24pm