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The Wax Report - Week Ending 12/02/2016

|Includes: BHGE, CLB, CRR, Occidental Petroleum Corporation (OXY)

The increasingly well managed Wax Ink Portfolio was up 4.2% overall for the week.

By comparison, the Dow was up 0.1%, the Nasdaq was down 2.7%, the S&P 500 was down 1.0%, the Russell 2000 was down 2.4%, and the Volatility Index, commonly known as the VIX, was up 14.4%.

Year to date, the Wax Ink portfolio is down 20.7% on a per share held basis, the Dow is up 10.0%, the Nasdaq is up 5.0%, the S&P 500 is up 7.2%, the Russell 2000 is up 15.7%, and the VIX is lower by 22.5%.

Portfolio Summary
The portfolio breakdown is roughly 52% cash, 48% equities, and 0% bonds. The current cash value on a per share basis is $25.41 and the current equity value on a per share basis is $23.59, making the average per share price $49.00. The average baseline valuation estimate of all equities currently held in the Wax Ink Portfolio is $29.23 and the average market closing price of all equities held in the Wax Ink Portfolio is $26.01, making the current portfolio growth potential factor (11.01%).

Hydrocarbon Prices
Two numbers often watched by oil traders are the Crude Spread (Brent Crude less WTI Crude) as well as the Gulf Coast Crack Spread (two barrels of gasoline + one barrel of heating oil - three barrels of crude oil) / 3). These numbers are now apart of The Wax Report.

WTI Crude ended the week at $51.68, up 12.2%, while Brent Crude ended the week at $54.46, up 15.3%, creating a crude price spread of $2.78, a gain of 135.6%. Distillate RBOB Gasoline ended the week at $1.5591, up 13.6%, and Heating Oil ended the week at $1.6581, up 12.8%, moving the Gulf Coast 3:2:1 Crack Spread to $15.19, an increase of 17.2% for the week. Natural Gas ended the week at $3.46, up 12.7%.

Year to date WTI Crude is higher by 39.5%, Brent Crude is higher by 46.1%, Natural Gas is higher by 47.9%, RBOB Gasoline is higher by 22.7%, Heating Oil is higher by 47.2%, and the Gulf Coast 3:2:1 Crack Spread is higher by 6.1%.

Treasury and Bond Yields
The 5 Year Treasury ended the week at 1.80, down 2.2%, while the 10 Year Treasury ended the week at 2.37, up 1.3%. The 5 Year AAA Municipal Bond ended the week at 1.85, up 25.0%, and the 10 Year AAA Municipal Bond ended the week at 2.61, up 20.3%. Lastly, the 5 Year AAA Corporate closed the week at 2.05, up 0.5%, with the 10 Year AAA Corporate ending the week up 1.3% at $3.02.

Year to date the 5 Year Treasury is up 3.4%, the 10 Year Treasury is up 5.3%, the 5 Year AAA Muni is up 49.2%, the 10 year AAA Muni is up 22.0%, the 5 Year AAA Corporate is up 7.9%, and the 10 Year AAA Corporate is up 3.4%.

Fair Warning
Please remember that the minimum holding time for shares in my portfolio is 60 months (1825 days), and that I have no position in any stock mentioned in this report. Additionally, I closed my position in Agrium, Inc. for a 243% gain after holding the stock for 3712 days.

Baseline Valuation Estimates and Worksheets
Baseline Valuation Estimates are initial valuations which Accredited Investors, after completing their own due diligence, can either increase or decrease in accordance with their individual risk tolerance or investing philosophy.

Financial data used in the creation of each Baseline Valuation Estimate is the most recent SEC 10-K ANNUAL financial data as reported to the U.S. Securities and Exchange Commission.

Archived worksheets may be downloaded by going to the Worksheets page at the site and selecting an industry which will move you to all of the worksheets I have updated for the selected industry.

Worksheets
Worksheets were either created or updated during the week for the following companies.

Occidental Petroleum Corporation (NYSE: OXY) - FYE 12/2015
Baker Hughes, Inc. (NYSE: BHI) - FYE 12/2015
CARBO Ceramics, Inc. (NYSE: CRR) - FYE 12/2015
Core Laboratories NV (NYSE: CLB) - FYE 12/2015

Baseline Valuation Estimates
Baseline valuation estimates are determined through fundamental analysis of the listed company's most recent annual financial information. Because these valuations are never exact, what is presented here is a baseline valuation range. Baseline valuation estimates were either created or updated during the week for the following companies:

Occidental Petroleum Corporation - $65-$70
Baker Hughes, Inc. - $30-$38
CARBO Ceramics, Inc. - $1-$1
Core Laboratories NV - $42-$47

Growth Only Valuation Estimates
Growth only valuations are determined utilizing current pricing levels, year over year earnings growth, dividend yield, the current PE ratio, and an earnings growth estimate. Because growth only valuations are EXTREMELY volatile, what is presented here is a single growth only valuation estimate. Growth only valuation estimates were either created or updated during the week for the following companies:

Occidental Petroleum Corporation - $2
Baker Hughes, Inc. - $59
CARBO Ceramics, Inc. - ($184)
Core Laboratories NV - $103

Investment Summaries
Investment summaries are determined based on fundamental valuation of the underlying equity AND a consider a minimum hold of 60 months (5 years). Investment summaries were issued during the week for the following companies:

Occidental Petroleum Corporation - Neutral - the current baseline valuation and key performance indicators (KPIs) are mixed for investment consideration at this time (NYSEARCA:HOLD)

Baker Hughes, Inc. - Negative - the current baseline valuation and key performance indicators (KPIs) no longer favor investment consideration (Sell)

CARBO Ceramics, Inc. - Negative - the current baseline valuation and key performance indicators (KPIs) no longer favor investment consideration (Sell)

Core Laboratories NV - Negative - the current baseline valuation and key performance indicators (KPIs) no longer favor investment consideration (Sell)

Have a great week.

Wax

Wax Ink is a baseline equity valuation company not licensed or registered with any government agency
Copyright © 2016 Wax Ink

Supporting Documents

  1. Wax_Ink_Portfolio_-_120216.pdf

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.