Crescent Point Energy has just announced today May 12th, the following share sale:

"Crescent Point also announces that it has entered into an agreement, on a bought deal basis, with a syndicate of underwriters co-led by BMO Capital Markets, CIBC and Scotia Capital Inc., and including RBC Capital Markets, FirstEnergy Capital Corp., TD Securities Inc., National Bank Financial Inc., GMP Securities L.P., Macquarie Capital Markets Canada Ltd. and Peters & Co. Limited for an offering of 9,150,000 Crescent Point shares at $41.00 per share to raise gross proceeds of approximately $375 million. Closing is expected to occur on or about June 2, 2010, and is subject to customary regulatory approvals. Crescent Point has also granted the underwriters an over-allotment option to purchase, on the same terms, up to an additional 1,372,500 Crescent Point shares. This option is exercisable, in whole or in part, by the underwriters at any time up to 30 days after closing. The maximum gross proceeds raised under this offering will be approximately $431 million, should this option be exercised in full. " http://www.theglobeandmail.com/globe-investor/news-sources/?date=20100512&archive=ccnm&slug=607134_1

This will have the immediate effect of diluting the number of shares that current shareholders own and it will decrease their value. This share sale is in addition to the number of shares that Crescent Point management is releasing to buy Shelter Bay Energy Inc. I am not happy about this. This is not the best time of the year in my opinion to do this either. With the "go away in May" syndrome a reality..ie.. a great many investors leave the market from May to October which is viewed as the worst time of year to be in the market. This is supported by the following article by John Heinzl titled:

Why Some Investors sell in May and go away, appeared in The Globe And Mail dated Monday May 10, 2010.

"The stock market’s brutal selloff last week may have caught some investors flat-footed, but for followers of the “sell in May and go away” strategy, the plunge came right on schedule.

Nobody knows exactly why the stock market has an uncanny tendency to deliver lousy returns from May through October, but post stellar gains from November through April.

The difference is staggering. According to the Stock Trader’s Almanac, $10,000 (U.S.) invested in the Dow Jones industrial average from Nov. 1 to April 30 every year from 1950 to 2008 would have grown to $474,305, assuming the money was switched to fixed-income investments from May 1 to Oct. 31.

But if the $10,000 was invested in stocks from May 1 to Oct. 31 and parked in fixed-income for the other six months, it would have shrunk to $8,012.

Robert Cable, director of wealth management with ScotiaMcLeod, is so convinced of the “sell in May” strategy that he switches a portion of his clients’ money – usually 10 to 33 per cent – to capitalize on the trend. He does the same with his own portfolio.

“I guess some people would say it’s dumb luck, but I’ve got data going back to 1950,” he says.

Rather than sell precisely on May 1 and buy on Nov. 1, Mr. Cable tracks the market’s moving average to time his exit and entry points. Early last week, before the panic hit, he got a “sell” signal and moved some money out of stocks.

Several theories attempt to explain the market’s seasonal trends. During the summer, fund managers are lounging at the cottage instead of buying stocks, so prices slide. Markets often rebound in December when investors are in a cheerful mood. In Canada, the registered retirement savings plan season gives stocks another boost.

But not everyone thinks it’s wise to try to capitalize on seasonal trends.

If you’d sold in May, 2009, for example, you would have missed out on big gains. In Canada, stocks also rose during the supposedly bad months every year from 2003 to 2007.

Skeptics say the seasonal trends may be nothing more than a product of “data mining.” In other words, if you examine enough data, patterns will emerge, even if they’re just the product of chance.

“Even if it’s real, even if it’s something that will hold up in the future, you’re still going to get nailed by it from time to time,” says William Bernstein, author of The Investor’s Manifesto. Attempting to time market cycles “is not something that’s conducive to sleeping at night.”

But Mr. Cable is convinced he’s on to something.

“People can say it’s a coincidence, but it’s been a coincidence for a very long time.”

http://www.theglobeandmail.com/globe-investor/investment-ideas/why-some-investors-sell-in-may-and-go-away/article1563723/

The facts in this article show that as an investor May is the worst possible time of year to do this deal, which will only dilute Crescent Point shares from an investors standpoint. Who would want to buy Crescent Point shares today and hold them through a down market over the next 6 months? There is now just too much risk in the market. With the Greek tragedy just played out a few days ago and the rest of the PIGS (Portugal, Italy, and Spain) yet to be dealt with in terms of their gross indebtedness, the sale of more shares by Crescent Point management at this time I view as a very risky move by management. So with this added risk, a number of analysts also view Crescent Point Energy shares as being way "overvalued", I will wait for Crescent Point shares to drop down to a more reasonable level before I invest anymore money in Crescent Point Energy. What Crescent Point management should have done was to wait until October to buy Selter Bay Energy Inc. They are already a 20% owner and could have done this deal at their leisure. Why the rush? The share holders will feel the brunt of this sale through a very volatile next 6 months.

Cheers; Scott