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George Fisher  

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  • Is It Too Late To Buy Exelon? [View article]
    Lalji,

    Thanks for reading and posting your question. I like offering reasons for my opinion so that readers have not only an understanding of the issues/potential risk/potential reward surrounding their investment selection but information they can update themselves over time. To me, this is the value of article writing.

    Even my monthly newsletter spreadsheet of the 130 companies I follow offers fundamental valuation analysis that makes it easy for subscribers to understand the reasoning behind each rating. These companies are evaluated based on 2016 PEG ratios, dividend yield and earnings yield, broker consensus for timeliness, and S&P Quality Rating.
    Feb 12, 2015. 10:45 PM | Likes Like |Link to Comment
  • Is It Too Late To Buy Exelon? [View article]
    skokie and Kevin,

    Thanks for reading and posting your comments. Skokie, I agree with your enthusiasm. I have written a few articles explaining the connection between natural gas pricing and electricity pricing and how EXC is a play on rising nat gas pricing. However, with the new PJM reliability premium, I think the problems with lack of capacity in the NE will be a determent to further nat gas fueled competitors.

    Kevin, as said too many times by the condescending politicos, "I feel your pain, bro". I also have a few shares bought at $41. It seems, however, EXC has found a bottom and the trough in power prices has/is passing. The relationship between power pricing and EXC should be acknowledged.
    Jan 22, 2015. 01:53 PM | Likes Like |Link to Comment
  • Is It Too Late To Buy Exelon? [View article]
    Bh0

    Thanks for reading and posting your comments.
    Jan 22, 2015. 01:46 PM | Likes Like |Link to Comment
  • Is It Too Late To Buy Exelon? [View article]
    bangalla,

    Thanks for reading and posting your comments. The strategy is to gin exposure to the commodity power markets in the Mid-Atlantic/Northeast where there is longer-term upwards pressure on pricing. Further dilution of this exposure by gaining more regulated assets will be counter productive to this strategy. So, no I would not be as much a supporter at 80/20 than I am at 60/40.
    Jan 22, 2015. 01:45 PM | Likes Like |Link to Comment
  • Exelon: Nuke Reliability Worth An Additional $5 A Share [View article]
    Hemlockcapital,

    I think the concept is the proposal will increase, not decrease, power prices as PJM looks to pay extra for reliability. EXC's nuke production is the type of power that will benefit from the proposal as the price for "reliability" will drive margins higher. The problem PJM is looking to cure was caused by cold weather, or the polar vortex, and its impact on natural gas and coal production.

    I agree with M* that the proposal should be a positive for EXC

    Thanks for reading and posting your comments
    Nov 4, 2014. 08:13 PM | Likes Like |Link to Comment
  • Exelon: Nuke Reliability Worth An Additional $5 A Share [View article]
    rr,

    I think it is a few quarters too soon to be looking for an increase. On a trailing 12-month basis, operating cash flow is $5.7 bil, cap ex is $5.4 bil and the reduced dividend paid is $1.1 bil. this would make a TTM negative free cash flow minus divy paid of $800 million (which is higher than year-end 2013). I think with increased revenues/ocf from improving power prices, a divy increase could be in the cards next year, along with positive ocf - cap ex (or free cash flow) - divy for the first time since 2010. Keep in mind free cash flow minus divy was $2.1 bil in 2008 and $1.5 bil in 2009.

    I think a turn in free cash flow minus divy will be the tell-tale signal of higher dividends in the future.
    Oct 22, 2014. 11:41 AM | Likes Like |Link to Comment
  • Exelon: Nuke Reliability Worth An Additional $5 A Share [View article]
    Hardog,

    Thanks for reading and posting your comments.
    Oct 22, 2014. 08:45 AM | Likes Like |Link to Comment
  • Exelon: Nuke Reliability Worth An Additional $5 A Share [View article]
    ultrabase,

    Thanks for reading and posting your comments
    Oct 22, 2014. 08:45 AM | Likes Like |Link to Comment
  • Exelon: Nuke Reliability Worth An Additional $5 A Share [View article]
    vinyl1,

    Thanks for your comments. EXC management gets bashed on most of these articles, so I wanted to post M* comments about management which has remained unchanged since last May:

    We give Exelon's management team a Standard Stewardship Rating. Since Exelon's earnings are at the mercy of wholesale power market ups and downs, we don't see much link between Exelon's recent underperformance and management's capabilities. We saw no significant strategic shift when president and CEO Chris Crane and executive chairman Mayo Shattuck III took over from former CEO and chairman John Rowe following the 2012 Constellation acquisition. Crane's biggest move so far is the $12 billion (including debt) Pepco acquisition that Exelon announced in April 2014, which will increase its share of regulated utilities earnings and dilute its consolidated exposure to wholesale power markets.

    We're particularly impressed by management's nuclear fleet operations, the one thing it can control. In his five years as COO, Crane led the generation division to world-class results. In 2013, Exelon recorded its highest capacity factor in at least the last five years at 94.1% and set a company generation record. With this operational excellence, management preserves the value-creation opportunities available if power prices rise.

    The Constellation acquisition reshaped the board along with the executive suite. The postmerger addition of four former Constellation board members and the retirement of five legacy Exelon board members, including Rowe, leaves only 2 of the 16 members who were on the board when Exelon formed in 2000. In addition, Shattuck has become the largest insider shareholder with 3.1 million shares or vested options. Rowe held 1.7 million shares or vested options as of year-end 2012. Given the more than 50% drop in Exelon's share price between 2008 and 2013, none of the stock options granted to executives since 2006 are in the money. We think this shows the strong tie between management compensation and shareholder interests.

    Hope you find this informative. Especially interesting to me is the lack of stock option resets while share prices collapsed. Option resets to me is a cardinal sin.
    Oct 22, 2014. 08:44 AM | 1 Like Like |Link to Comment
  • Exelon: Nuke Reliability Worth An Additional $5 A Share [View article]
    rr,

    Thanks for reading and posting your comments. 2014 is expected to be a trough year for earnings, and this announcement of higher merchant power prices should help.
    Oct 22, 2014. 08:39 AM | Likes Like |Link to Comment
  • Exelon: Nuke Reliability Worth An Additional $5 A Share [View article]
    wald,

    Thanks for the link. It is unfortunate to me the politicization of building gas pipelines in the Northeast as most voters are unaware of the connection between their electric bill and lack of gas pipeline capacity. I appreciate your reading and posting comments.
    Oct 22, 2014. 08:37 AM | Likes Like |Link to Comment
  • Exelon: Buy The Dip [View article]
    martin,

    "Are other utilities immune from the forces that are causing EXC to underperform?"

    The correct answer is "yes", and their past performance is in many cases worse than EXC. Below is a quote from an article about the merchant power business:

    "The merchant power sector has a much checkered past. Seemingly, much like the airlines industry, large merchant power producers cycle in and out of bankruptcy.

    Calpine has a large capacity of natural gas-fired generation and filed for bankruptcy in 2005 when natural gas skyrocketed to $12/MMBtu.
    Dynergy recently exited bankruptcy and was plagued by high cost, declining demand and low electricity revenues.
    NEG was liquidated in Chapter 7 in 2004 due to serious debt problems after borrowing heavily to expand its natural gas-fired capacity.
    GenOn was created after Mirant, exiting from bankruptcy after being spun out of Southern Company, merged with the merchant power business of Reliant.
    NRG went through its own bankruptcy in 2004.
    In Oct 2013, NRG decided to acquire Edison Mission Energy, a subsidiary of Edison International (NYSE:EIX) for a purchase price of $2.64 billion. The buyout will add nearly 8,000 megawatt MW of capacity to NRG Energy's generation portfolio and diversify its generation portfolio.

    From an article last Nov http://seekingalpha.co...
    Aug 19, 2014. 05:38 PM | 1 Like Like |Link to Comment
  • Exelon: Buy The Dip [View article]
    It's Electric

    Thanks for reading and posting your comments.
    Aug 19, 2014. 04:52 PM | Likes Like |Link to Comment
  • Exelon: Buy The Dip [View article]
    Robin,

    Thanks for your kind words. Your rephrasing is right on point. I appreciate your reading and posting your comments.
    Aug 19, 2014. 04:51 PM | Likes Like |Link to Comment
  • Exelon: Buy The Dip [View article]
    jay,

    Thanks for reading and posting your comments.
    Aug 18, 2014. 04:33 PM | Likes Like |Link to Comment
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