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Bob Carl

Bob Carl
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  • What Is 'Smart Money' Shorting In This Psychotically Bullish Market [View article]
    This so-called smart money isn't that smart as the historic record of short sellers can confirm. Remember being short means you are paying the lender the dividend and if you are shorting a company that traditionally buys back stock (i.e. XOM, PFE, MRK, MO), the odds are against you.

    I actually like to go long long those types of companies and look at their huge short positions as a buffer against future declines.
    May 22, 2015. 10:22 AM | 1 Like Like |Link to Comment
  • Exxon Mobil - Relative Strength Thanks To The Integrated Business Model [View article]
    You are right, I was thinking of Bayonne, I used to smell its emissions from afar!
    May 3, 2015. 11:12 AM | Likes Like |Link to Comment
  • Shareholder Friendly ExxonMobil's Integrated Model Is A Plus [View article]
    Right. Maybe 145 years in business has taught them something. That something, going back to Rockefeller, is to manage for the long run, not for any particular quarter or year. Few companies really do that today. Besides history and corporate cultures, Exxon's executive compensation plan is structured to align management with long run returns. There are no stock options, only long term restricted stock grants that vest over ten years.
    May 3, 2015. 11:06 AM | 5 Likes Like |Link to Comment
  • Exxon Mobil - Relative Strength Thanks To The Integrated Business Model [View article]
    Bayway was a smaller very old facility. It was actually losing money. It made sense to close it and obtain economies of scale in refining elsewhere.
    May 2, 2015. 03:29 PM | 1 Like Like |Link to Comment
  • Arch Coal Could Be An Attractive Buyout Candidate [View article]
    ACI stock is functionally worthless. The play here is their deeply discounted debt. If ACI somehow survives, the debt offers an enormous upside: with interest payments, of about 6x. If, as I suspect, they declare bankruptcy in 2018, if not sooner, I believe the unsecured debt will be worth enough (ten cents on the dollar) to break even on.
    Apr 22, 2015. 03:29 PM | 2 Likes Like |Link to Comment
  • Despite Exxon Bumping Up Your Dividend In April, It Is Not A Buy [View article]
    Look for XOM to raise the dividend to $0.72 from $0.69, an increase of 4.35% being a real increase (after inflation of about 1.7%) of 2.65%. This will cost the company about $500 million a year in increased cash payout, which they can easily finance. I would expect similar annual increases for the next several years as the company deals with lower oil prices.

    Also, look for improved profits from downstream and chemicals to partially offset the impact of cyclically low upstream earnings in the first quarter.

    I am still buying XOM.
    Apr 13, 2015. 09:43 PM | 15 Likes Like |Link to Comment
  • Time To Gamble On Arch Coal [View article]
    I am long the senior unsecured debt. I have a 48% current yield good for about two years. If ACI fails, I have an unsecured claim that might be worth 10-20 cents on the dollar. If at 10, and assuming bankruptcy in December, 2017, then I breakeven. If they can starve off bankruptcy until mid 2018, I make a little more money, if coal markets improve and they an pay my 2019 bonds at maturity I make 4x my money back. That's what I call an asymetrical bet and one anyone can make. I would totally avoid the stock.

    What can go wrong? They can declare bankruptcy much sooner than 12/17, but I doubt that given their debt maturities are minimal until their secured bank debt matures 05-16-2018.
    Mar 16, 2015. 10:18 PM | 2 Likes Like |Link to Comment
  • Still not time to buy Exxon or other big energy stocks, analyst says [View news story]

    There were many times in the history of the Standard Oil Company when "there is no value here" would have been applicable. I have studied this since I was 19 (I am 61 now). Some examples:

    1911 - The Supreme Court's Breakup Decree. This proved to be the greatest buying opportunity when SO's stock decreased by about 60%.

    1932 - The Great Depression. Standard Oil cuts it dividend by about 40%.

    Much more recently, and when I was a young investor - 1973-1974 - the Arab oil embargo, the power of OPEC, and the nationalization (really confiscation) of ARAMCO and other foreign holdings. I remember that the consensus on the Street was that the great international oil companies would become little more than utilities. I bought Standard Oil Company of California (now Chevron) back then because it was dirt cheap. So was Standard Oil (New Jersey) (Exxon) and Mobil, also Texaco, Gulf, and Shell.
    And guess what? In the context of the times, the analysts were right, there was no value there...but only if these companies continued with their old structures and operational strategies. Good managers are not deer caught in headlights, and all of those companies found ways to adapt to the new era - some by merging into stronger competitors, others by buying synergies. CVX and XOM were the principal winners and their returns from the mid 1970s have been profound.

    I buy XOM today because in the scheme of risk adjusted returns it looks reasonably valued in light of longer term opportunity. In the meantime, as a retired investor, the dividend is attractive in a low yield world. I buy XOM because I have confidence that come what may, XOM management will adapt and prosper. I suspect that in the short run, the stock will drop, but I am not able to forecast an absolute low. So I buy regularly. If XOM drops to $65 between now and 01/2017, I will be put 5,000 shares at that price, less put premium. My overall target is to acquire up to 30,000 XOM over the next 5 years and then watch it recover.

    Mar 14, 2015. 12:18 PM | Likes Like |Link to Comment
  • Still not time to buy Exxon or other big energy stocks, analyst says [View news story]
    Is the time to buy is whenever things look great? Well, that is the conventional wisdom. For me, with 40+ years in investment experience and having run and sold a successful public company, I say if you want to beat the market in the long run, the only way is be a contrarian and buy when good companies are cheap due to temporary difficulties. So, I keep buying XOM and I pick up a decent, secure yield while I wait for the inevitable turn. CVX and COP are good values as is BP which may well be an acquisition target.
    Mar 11, 2015. 10:48 PM | 1 Like Like |Link to Comment
  • What Every Savvy Oil E&P CEO Should Consider Now: Buying Penn Virginia [View article]
    For whatever it is worth, the long term history of PVA is dismal. This company goes back to the Leisenring anthracite coal operations in the late 19th century. Maybe it did well then, but as a public company, it has never returned much. It's price is the same as 30 years ago: check it out.

    I have owned it in its oil phase, and I do agree, they have some small, but very good Eagle Ford plays. The company should be sold.
    Mar 11, 2015. 12:47 AM | 1 Like Like |Link to Comment
  • Russia Is Exxon Mobil's Future, And The Future Is Bright [View article]
    While bullish on XOM and while I respect their long term strategy, doing business in Russia remains problematical. The rule of law just doesn't exit in Russia. Perhaps in a post-Putin Russia, it might. Of course XOM is more or less immortal while Putin is not! We will see if XOM's patience pays off.
    Mar 5, 2015. 06:43 PM | 8 Likes Like |Link to Comment
  • Avoid Shares Of Exxon Mobil [View article]
    I totally disagree. Great companies take advantage of industry recessions to establish firm foundations for future growth. Exxon and its predecessors have always done this in the past. I see no reason why this time is different.
    Mar 4, 2015. 11:22 PM | 25 Likes Like |Link to Comment
  • Chesapeake Energy - A Soft End To 2014 And A Dampened Outlook For 2015 [View article]
    Total agreement. I had sold CHK at a nice profit some time ago, recently reentered by buying 5,000 shares at $16.95. Will buy more too.
    Mar 3, 2015. 11:25 PM | 3 Likes Like |Link to Comment
  • Exxon needs $85 oil to cover capex and dividend, Oppenheimer says [View news story]
    The Oppenheimer analyst must assume that XOM's management is like a deer caught in the headlights. The Deutsche Bank analyst seems more understanding that management is responsive to both near term challenges and long term opportunities.
    Mar 3, 2015. 12:34 PM | Likes Like |Link to Comment
  • Exxon adds proven reserves totaling 1.5B boe [View news story]

    A company's proved reserves must be audited by an independent reserve valuation consultant and be reported annually to the SEC on Form 10-K. So you do have a fair amount of oversight. Obviously, "current conditions" imply some leeway as production costs vary greatly as do pricing assumptions.
    Feb 23, 2015. 07:32 PM | 1 Like Like |Link to Comment