Best of the boards: Leni Gas and Oil, Tesco, Caza Oil and Gas

In this week's Best of the Boards, Interactive Investor takes a look at how users have reacted to some of this week's news on the discussion boards.

A week of good news has boosted Leni Gas and Oil's market capitalisation by over £20 million and the same story seemed to ring true for Caza Oil and Gas, until the 4p gains it had made this week were all but wiped out by Friday.

Supermarket chain Tesco announced its first-quarter sales growth slumped by 3.7% on Wednesday. Compared to this time last year, Tesco's share price is down 73p.

Leni Gas and Oil

What happened: In what has been a great week for Leni Gas and Oil. The producer's market capitalisation has surged by just under £20 million, with the company's market-worth totalling £68.31 million in afternoon trading on Friday.

In the past five days, Leni announced that its GY-664 well in Trinidad has started producing oil, well GY-665 intersected a net oil pay of 270 feet in the Goudron sands and the company had completed the full Equity Swap Agreement with YA Global Master. On Thursday the company announced that it had ended talks of a potential Spanish partnership to focus on its Trinidadian assets in light of the stream of successful drilling news.

Leni's share price has been trading at its highest level for 12 months, signalling that it could be on its way to regaining its share price levels of 5p in 2009.

What users said: 'Onceatrader' said Monday's update was "company changing news" and 'alltold9' agreed that "in their own words today's news is transformational, with an abundance news flow expected short-term."

'hobione' said: "Company's producing oil and with more wells to come it’s time to invest in my view. It's a game changer when a prospecting company becomes a producing company."

'Barno99' said: "On another note, when the price hangs around like this it usually means the market makers are setting a target, because don't think simple cash moves a price - it's the casino owners that move it. This will see 10p within months."

But 'TheGoldVision' said: "Pack the ramping in ...10p in months ...Behave."

'Barno99' replied: "Why not? We have just been told we have another well on stream very soon, and more deeper oil to come from the existing well that's pumping. If they can hit 1,000 barrels a day I don't see any reason why 10p is not a target within, say, four-six months. Interesting times ahead. Call it ramping if you like; it's my target for the company and I will hold out for it."

After Tuesday's GY-665 well update 'Growbags' said: "Am very happy with latest news. Having been holding for what seems an age from 0.71p. I think this might get very interesting over the rest of this year if they carry on in this vein. Trinidad is certainly a place that can throw up some nice results and on relative low capex. Was a very smart move for Leni to get into T&T indeed."

However, some users were wary of the rising share price. On Wednesday '20pt4' said: "This is getting a little on the silly side. Just on what hard news are the market makers justifying today's price and movement?"

But 'alltold9' was more optimistic, saying, "Silly you may say, but with 30 transformational wells in the future, this is far from silly and may just be conservative."

"Only two so far drilled or being drilled, just what makes you think the other 28 are going to hit pay dirt?" replied '20pt4', who's sentiment was shared by 'Mikerockafella', "They're sucking you in."

Some investors were unsure how to react to the increasing share price. "Bought these in late 2012 and seeing a very nice return but should I sell half or wait a couple of weeks? There are over two billion shares in issue so the price can dive very fast too. So may be a volatile stock soon," warned 'city watcher'.

'Yamato' agreed it was not clean-cut, "Rising still on good volume, very hard decision to make, but I decided to sell around 20%, to reinvest."

The consensus recommendation on the Interactive Investor discussion board this week was 'strong buy'.

Tesco

What happened: High-street supermarket Tesco's first-quarter sales growth slumped by 3.7%, it announced on Wednesday, causing its share price to close 4p lower. By the end of the week, its value had lost around £640 million.

"Loyalty" was the buzzword of Wednesday's update and chief executive Philip Clarke put the drop down to the chain spurring on plans to enhance customer satisfaction, which has involved four waves of price cuts this quarter, rewards through Clubcard Fuel Save, cheaper online services, and the revamp of over 100 stores.

Compared to this time last year, Tesco's share price is down 73p.

What users said: Although 'Comedyoferrors' believed large supermarkets have to be concerned about its discount rivals, the user said that the "no-frills" supermarkets are saving money by "having no manned customer services, minimal floor staff, fewer checkouts and by not accepting credit cards".

"Let's be realistic, a 3% fall in sales translates to sales have been maintained at 97% of previous levels, and the dividend has been maintained. Equally, our own supermarkets have tended to ignore the potential threat the discounters pose.

"Our large supermarkets do have something to fear. They have been happy with their status quo and simply ignored the irritation of discounters. British Leyland's demise is testament to what can happen as a result of complacency. However, I do believe that this time around our supermarkets will not go the way of the British Car Industry. Actually, they really do not have a choice."

However, 'Hardcore Uproar' said: "3% fall in sales is appalling as The Telegraph puts it, it's losing over one million transactions a week, that is huge, sooner or later there is going to come another profits warning.

"You have to go to the underlying problem of falling consumer purchasing power and disposable income. Asset prices across the board are at the highest levels (what could possibly go wrong?) yet Tesco and most other retailers are feeling rather lousy. What's going to happen when asset prices start to decrease?

"The board doesn't expect any improvement this year, things can only deteriorate. Absolutely no reason to own supermarket shares."

'Axolotl' seemed to agree: "Let's face it, Tesco has lost its way. A bit like M&S clothing, we used to know what it was for but we no longer do. These great names of the past never seem to sink but unless they can find inspirational new leadership they will never swim either. All they can do is drift. How sad."

While one user worried about Tesco's future, 'AlanTittymarsh' replied: "I doubt for a moment Tesco will go bust. There's a good chance they will end up a much smaller organisation with fewer staff, lower profits and smaller margins and dividends, but they should stay profitable in the long run.

"In the end they will have to take on Lidl and Aldi by cutting their margins, and not by trying to lure in customers with the long, tired-out con of BOGOF [buy one get one free]. They could also do away with Clubcard as that has become a worthless exercise, which many customers have woken up to."

'Loadsadosh2' managed to be optimistic, "What about their new ventures in China and India? Could be huge potential there.

"Also there will only be so much customer defection to Aldi/Lidl; not everyone can get to an Aldi/Lidl and after a point these stores won't be able to handle any more customers with only one or two working checkouts and have to employ more staff and raise prices to cover the costs."

The consensus on the Interactive Investor discussion board was 'weak buy'.

Caza Oil and Gas

What happened: After informing the market that it had secured a £10 million funding boost to develop its drilling in the Bone Spring play, Caza initially rose by 3% on Thursday. However, by the time the markets had closed, the oil and gas company had dropped to 24.5p.

The £10 million advance is part of a previously agreed loan deal with Apollo Investment Corporation, which has seen Caza draw $45 million (£26.84 million) from the facility. Subject to performance and financial requirements, the oil and gas company can purchase up to $50 million of senior secured notes from the investor.

The funding will be used for drilling development at the West Copperline, Gramma Ridge, Forehand Ranch, Marathon Road and Jazzmaster properties, targeting the Cherry Canyon and Bone Spring formations.

Prior to Thursday's fall, Caza's share price had rocketed since March, climbing from the high 7s to 25.12p at Wednesday close, increasing its market capitalisation by around £35 million.

However, on Friday it had nearly lost the 4p gain it had made since the beginning of the week and was down over 11% on Thursday's closing price at 21.62p.

What users said: After the financing news, 'great bull' said on the Interactive Investor discussion board, "Looks like full steam ahead with Apollo funding the upcoming drills. There must be a lot of confidence in Caza producing the goods."

'Shareordie' said: "I think we are well ahead of debt with our production. One or two new producing wells will give us plenty of cash and may add 10-20p to the share price."

'Pharma Brown' expected the share price to break 30p in Thursday's trading, but 'bilko22' thought investors would be "a little loco buying at these levels.

"No doubt Caza are doing well with the drill but after watching this one for a few years it know how to bite. No doubt it will," the user added.

One user said they had not expected such a share price increase without news of a takeover, before adding that the rice was a concern - "in a very happy way".

'The Astrognat' said: "Originally I had an average in the 40's but bought heavily and posted so at 8.5p about one year ago. Although I did reduce my overall holding by 45000 when profits elsewhere allowed me to sell at my combined average, I was vastly overexposed and the plan was to sell at 16.5p."

"Due to travel I missed 16.5p but ended up selling half the holding at just over 22p. The remainder went today between 24.75 and 25 as I am concerned we will get a pullback.

It's unusual for a share to triple and not have a pullback, but then this is AIM and no rules apply other than private investors have either been screwed or will get screwed at some point.

"There is much more price volatility at Caza to come but for the moment I am taking a break...an unexpected break. I can gather my thoughts and decide whether to wait for an entry point once/if the buying pressure reduces and our good friend Yorkville reduces heavily.

"It is difficult to determine what holding remains in their hands at present and its impossible for any of us to determine since many sells will be people like me undertaking either 'relief' sales or top slicing and these will easily be 50,000 chunks depending on whether you can get a quote or not at the price," the user concluded.

In reply, 'JMB007' noted that considering the recent rise, the potential for a pull-back or retrace is logical.

"I think part of the rise is just a natural bounce back to more reasonable fundamental valuation levels and part is due to the market catching up with the drill news. Also the liquidity on this stock is very small so shifts in sentiment can move the share price in an exaggerated manner either way.

"After having reloaded at 8p I must say that I am tempted to slice but feel that Caza is still very much undervalued. The real question is does the market?"

The user added that the answer will arise over the next few weeks with drilling results and whether the oil and gas company can show it can self-fund without dilution.

"I thought 8p was a joke valuation and that the lower it went the more it was like a coiled spring - I reckon 25p is still pretty cheap and a recent comparison with other operators in the Permian basin by Value Digger would seem to corroborate this.

"We have all been burnt by Caza in the last three years so selling and top slicing is a natural and cautious attitude. Personally I am going to let this ride as 25p is too cheap to sell although I acknowledge that if there is a retrace you might get back in cheaper," the user added.

The consensus recommendation from Interactive Investor users was 'strong buy'.