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Bob Carl

Bob Carl
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  • Update: Slashing The Dividend Is A Wise Move By Penn West [View article]
    Readers will recall my bearishness on this money pit. Normally, a dividend cut in these circumstances would be prudent, but PWE has destroyed so much shareholder capital that they we might be better off if they cut cap ex to zero and started making liquidating dividends!
    Dec 19, 2014. 07:18 PM | Likes Like |Link to Comment
  • XOM Hedges Against Environmental Backlash Of Shale Oil Mining [View article]
    Nice analysis. XOM has always managed for the long term and ignores the short term. Maybe that's why it's led its industry since 1870.
    Dec 19, 2014. 03:31 PM | 4 Likes Like |Link to Comment
  • Here's Why I Am Seriously Considering Selling My Altria Stock To Buy Chevron [View article]
    MO has a huge current advantage over CVX due to extemely divergent Cap Ex requirements. It will continue to increase its dividend. CVX is a fine company, but wait for it to fall to to the low 60s before buying. Then, I will mortgage my ranch and sell my 14,000 shares of MO, buy CVX and XOM and wait for the turn in oil prices. I expect this to happen by March, 2015. Mark my words.
    Dec 13, 2014. 05:44 PM | 1 Like Like |Link to Comment
  • Don't Buy Exxon Mobil [View article]
    Absurdly short term thinking.

    Exxon merits a premium to its peers due to superior downstream integration, AAA credit rating, and low cost reserves.

    This company or its ancestors has been around since 1870. It has weathered far greater crises than a temporary decline in oil prices. Indeed, look for XOM to grow by buying weaker companies or their assets at discounted prices.
    Dec 11, 2014. 10:20 AM | 19 Likes Like |Link to Comment
  • Dividend Zombies: Exxon - YDP Analysis & Fair Value Appraisal (Part 4) [View article]
    I believe XOM will go as low as $60 based on 2 standard deviations from a long term regression trend line with an R squared value of 0.9. This is consistent with past performance over the last 30 years.
    Dec 11, 2014. 08:42 AM | 1 Like Like |Link to Comment
  • Denning: Climate improves for E&P acquisitions, including Exxon for BG [View news story]
    I think XOM is more likely to bid for wounded BP. The merger synergies are profound.
    Dec 8, 2014. 03:21 PM | Likes Like |Link to Comment
  • Exxon Mobil: A Massive Buying Opportunity? Don't Drink The Kool-Aid [View article]
    Long experience (40 years) and some success (cumulative capital gains of about $25 million) teaches me that contrarian investing works. One man's value trap is another's buying opportunity. So, I am still buying XOM. I have about 20,000 shares now and recently sold a naked put, strike price $65, to add to my position.

    i suggest investors use, as I do, XOM's DRIP plan. It's totally free. If Mr. Clark is right, you will accumulate a very nice position. Remember, XOM management has many options now for counter cyclical investment. They can buy discounted shale oil assets, they can buy BP, or another larger company and obtain merger synergies. If, and I do not believe this to be the case, oil prices remain deeply depressed for years, XOM can reduce its capital expenditures significantly, and its free cash flow will increase. That free cash flow can sustain dividend increases even in an absolutely horrid oil market.

    One other thing: XOM sells at a premium to book and its p/e is higher than its peers for a reason: vertical integration, low cost reserves and lifting costs, integrated chemical operations, and an AAA credit rating. You pay more for quality.
    Dec 5, 2014. 10:25 AM | 17 Likes Like |Link to Comment
  • Pipeline firms slammed after OPEC decision to maintain output [View news story]
    I am very long MMP (at $8-$12) and also RGP ($20). Never nice to see a violent sell-off, but all of these stocks (especially MMP) were overbought. Here's my take: on the margin, lower oil prices will mean somewhat lower (10-30%) production out of the shale fields and the work-overs in the Permian. The latter will impact MMP's growth over the next several years. Conversely, the drop in oil prices is hugely deflationary and that means lower discount rates applied to these companies' cash flows, thus propping up share prices.
    Nov 29, 2014. 02:39 PM | 1 Like Like |Link to Comment
  • Dividend Zombies: Exxon - YDP Analysis & Fair Value Appraisal (Part 4) [View article]
    Nice article, but one minor fact is wrong. Standard Oil Company (New Jersey) did reduce its dividend in 1932 by 40%. Given deflation of about 40% between 1929 and 1932, the dividend remained roughly constant in real dollars.
    Nov 11, 2014. 12:32 AM | 2 Likes Like |Link to Comment
  • Tompkins Financial Corporation beats by $0.07, beats on revenue [View news story]
    Solid growth by a very solid small regional bank holding company. It appears their acquisition of VIST Financial is working well. I am impressed by credit metrics here. Disclosure: I was a director of VIST and am long TMP.
    Oct 28, 2014. 11:08 AM | Likes Like |Link to Comment
  • Merck Still Looks Very Expensive [View article]
    Your analysis is entirely retrospective. What drives pharma stocks is the pipeline and new drugs coming unto the market. Let's have some discussion of the REASONS For the multiple expansion.
    Oct 14, 2014. 03:56 PM | 2 Likes Like |Link to Comment
  • Venezuela says it will pay less than $1B to Exxon over nationalization [View news story]
    Exxon will net about $250 million more than the $750 million book value, but it will be cash instead of a ledger entry and it adds marginally to its liquidity and financial flexibility. A moral victory perhaps, but little more.
    Oct 10, 2014. 11:26 PM | 2 Likes Like |Link to Comment
  • Exxon Mobil Still Looks Rich [View article]
    XOM with its AAA rated balance sheet and free cash flows can use this period of weakness in oil prices and declining oil company stock prices to acquire any number of highly leveraged E&P companies as well as troubled BP.

    I suspect BP is on the short list as XOM is historically better at defending environmental liabilities and deferring damages payouts. BP's cash flow can be much more easily impacted by declining crude prices and increasing damage claims and judgments. With participation in the Russian oil development now a forlorn hope, XOM can best drill for oil on Wall Street by (1) continuing its share buyback, and, more spectacularly buying BP. Doing so allows for many economies of scale and, oddly, essentially reunites to their parent ex-Standard companies Standard Oil of Indiana (AMOCO), Atlantic Refining (ARCO) and Standard Oil of Ohio (SOHIO), all these companies comprising the bulk of BP's Western Hemisphere assets. Only Chevron (Standard Oil Company of California) will remain outside the fold.

    Much of Lee Raymond's success was created by his purchase of Mobil (Standard Oil Company of New York, Vacuum Oil) in 1999 creating today's Exxon Mobil. Rex Tillerson overpaid by 50% on his purchase of XTO in 2010. I suspect he will want to end his tenure with another big purchase and that will probably be BP. Personally, I think a merger of near equals with Chevron would be more exciting, but highly improbable.

    I am long and continuing to buy XOM.
    Oct 9, 2014. 09:14 PM | 1 Like Like |Link to Comment
  • Penn West: Putting Its House In Order [View article]
    Hope springs eternal. Value trap.

    Assuming oil prices hold at current levels, PWE might be okay, but if not, this stock will see $5 before it sees $10/share.

    I have lost hundreds of thousands of dollars buying PWE and its ilk when they seemed undervalued. PWE, along with PGH, and SGL, all looked cheap, with an attractive yield when I bought them. They are cheaper today and will be cheaper tomorrow.
    Sep 28, 2014. 02:40 PM | 4 Likes Like |Link to Comment
  • FT: Exxon, Rosneft strike oil at sanctioned Russian well [View news story]
    I agree. Ukraine is an artificial country anyway. The never was an independent Ukraine (excepting the Grand Duchy of Kiev) before the Mongol Invasions of the 13th century. After Mongol rule, it was either part of Poland or Russia, then the USSR. Only after the USSR broke up was the "Republic of Ukraine" set up. Putin has a pretty good argument for wanting influence there, if not to take it all back. It was part of Russia, afterall.

    Unfortunately for us XOM shareholders, this crisis is unlikely to be favorably resolved anytime soon. We need to think of the venture as a lottery ticket - very unlikely to pay off, but if it does, it pays off big. XOM management will certainly try to keep the venture alive, but should also mentally "write it off" and look for other opportunities.
    Sep 26, 2014. 09:57 PM | 2 Likes Like |Link to Comment
COMMENTS STATS
212 Comments
400 Likes