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Ray Merola

 
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  • Everything-Else Caps: Know What You Own And Why [View article]
    Well done article, DAG1996

    You have laid out a good case for mid and small caps, often overlooked by the big guys.
    Aug 19 08:20 AM | 1 Like Like |Link to Comment
  • General Mills: Well Positioned In Many Great Sectors, Valuation Elevated [View article]
    Good article, VR

    Another metric by which GIS stock appears above fair value is Price/Book. Historically, the P/B has been below 4x. Currently, the P/B is over 5x. This is a function of elevated price and modestly declining book value.

    As a GIS investor, I have concern about the slow erosion in net book. Something to monitor carefully going forward.

    The dividend is secure, the management is good, and the forward prospects are decent but not overwhelmingly strong.
    Aug 15 08:10 PM | Likes Like |Link to Comment
  • Energy Transfer Rocks On... Reloads The Cannons [View article]
    I reckon that's worth the price of admission, hingoyield? All the best.
    Aug 15 07:51 PM | Likes Like |Link to Comment
  • Energy Transfer Rocks On... Reloads The Cannons [View article]
    Agree, Ernie Mac

    Thanks for reading.
    Aug 15 04:06 PM | Likes Like |Link to Comment
  • Energy Transfer Rocks On... Reloads The Cannons [View article]
    Excellent point, Dan

    I have been utilizing this "free" extra dividend for years. Hard not to do so.
    Aug 15 04:06 PM | 1 Like Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    You are most welcome and many thanks, Brodidiy1
    Aug 15 02:22 PM | Likes Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    Brodidily

    Recommend going to the Shell Investor web site. There is a link there that goes through the ins and outs of the A and B shares.

    In a nutshell, the A shares have Dutch dividend taxes withheld; some U.S. T/Ps can file to recover that. The B shares trade on the London exchange; no taxes are withheld at source.
    Aug 15 11:56 AM | Likes Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    gausmus

    You bring up some very good points. Shell has never had strong expense management or commercial discipline. I speak from working some 30 years in the Downstream organization. My candid view is the Upstream was no different. At Shell, the culture has long revolved around strict attention to safety, sound engineering practices (though this includes "gold plating"), and good operations. "Good" in this context does not mean cheap.

    It is very difficult to change culture within an organization as large as Shell. Mr. van Beurden is beginning his tenure by focusing upon controlling cash where the money is biggest: capital. Operating expenses are a smaller piece of the puzzle in an overall sense. It would be an outstanding development if the company could change management in this arena. Unlike ExxonMobil, Shell has never emphasized strong cost control other than during times of crisis.

    The smaller, more nimble, and cost-efficient E&P outfits have run the majors out of much of the North American oil/gas renaissance. I believe the overhead, deliberation, and expense apparatus is just too much for them to compete with companies like EOG, Continental, etc.
    Aug 15 10:29 AM | 2 Likes Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    Thank you, User10124701, for reading.

    From the most recent slide deck, it appears that "Singapore fuels" has been targeted as a "FIX" asset. Please see the presentation slide in the article.

    My view is that either Shell does, indeed, "fix it" as relates to cash and capital return, or the company will jettison it. van Beurden has a head of steam after 2 quarterly beats; I would not anticipate his energy for forcing issues and cutting underperforming assets to wane anytime soon.
    Aug 15 10:19 AM | Likes Like |Link to Comment
  • Energy Transfer Rocks On... Reloads The Cannons [View article]
    metal27

    Thanks for the kind words.

    I really don't envision the KMI deal as having an effect on Energy Transfer. ETE is one of the few midstream MLPs that has the size and wherewithal to follow suit, but I do not see compelling reason for Warren to fiddle around with that right now. There's too many other irons in the fire.

    All speculation on TRGP; another run is possible. If one wants to stoke the rumor mill, I'd go with Regency Energy Partners. ETE is already the GP, and Energy Transfer bought another chunk of the units over the last quarter.
    Aug 15 07:40 AM | 1 Like Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    Thank you Robert

    Shell stopped the scrip dividend program after the last payout. Among the reasons for doing so was it was causing a disconnect between the prices of A and B shares. Management wants them to track together.

    Without the Shell DRIP, you were dumped into the Fidelity stock reinvestment program; a different animal.

    Rick D below adds some more color to the discussion.
    Aug 14 11:49 PM | Likes Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    Thanks for your comments, john001

    Trust I did not cause confusion when outlining van Beurden's objectives. Indeed, the Shell presentation slide shows that Canada and Permian LRS are primary N.A. Upstream "growth" engines.

    Returns have been unacceptably low. The program is to proceed with strong RoIC projects and ditch many of the low-performance, low-return assets. My view is Shell got to the party late and did not obtain great properties (some of which was just misfortune, not critical errors). I believe the major sticking point was Shell's inability to be nimble and flexible. The North American plays are begin exploited by smaller E&P companies; they can run circles around RDS when it comes to speed, decision-making, and lower-cost operations. The LRS world belongs to the quick hitters and "wildcatters."
    Aug 14 09:37 PM | 3 Likes Like |Link to Comment
  • What Is Next After Shell Completes Its Divestment Program? [View article]
    Pim

    For swing traders, I agree that Shell may be nearer to a top than a bottom. However, for longer-term investors, I believe one must give van Beurden a chance to implement his vision for the company.

    Shell has lagged the Super Majors re capital efficiency for some time. This is exactly van Beurden's longsuit in Shell Chemical: strong financial discipline, emphasis on returns, and keen focus on safety.

    The dividend provides considerable yield support, so while the shares are not cheap today, I believe they could see an upside of 15-18% if van Beurden's initiatives take hold. In particular, he has stated he expects RDS to generate $50 operating cash flow in 2015/16.
    Aug 14 04:31 PM | 1 Like Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    I suspect Voser let the capex spending get too far out of hand. Throwing money into Nigeria (nearly hopeless), the Arctic (unprepared for the Green blow-back), and Oil Products (sound operations, but lacking commercial discipline) boxed him into a corner. As noted on the table in the article, Shell's capital returns were at the bottom of the pile versus Super Major peers.
    Aug 14 03:51 PM | 1 Like Like |Link to Comment
  • New Shell CEO Takes Out The Trash [View article]
    Hi smurf

    The whims of the oil markets can buffet any of the energy companies. This is where van Beurden's discipline and focus may pay off. The best organizations manage the business and WS expectations to what the market throw at it.

    I found prior CEO Voser holding a credible strategy: running for cash, setting the business up for the future, and linking results to the dividend. However, I appreciate van Beurden's more. He adds the missing component: demanding good returns on the capital employed. This forces tough choices and a skinnier enterprise.

    Two beats in a row. Good start.
    Aug 14 03:38 PM | 1 Like Like |Link to Comment
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