Gonna see if I can get ahold of some sub $53 per share action on Thursday.

P/E certainly matters but it's pretty dependent on capital expenditure and where those earnings come from... there's a very big difference in those between CVX and XOM the last couple of years. And earnings growth projections are also very different.

BIMS O1 said:

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At what point does XOM become the "falling knife"? As a recent purchaser, i am hoping there will be a reversal in the near future.

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I would say that it was a falling knife when you purchased it.

Market is Supposed to open down again. I'm betting it will go below 53

Bocephus said:

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Market is Supposed to open down again. I'm betting it will go below 53

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51.65 while I type this. Was going to enter today and waiting on my adviser to call.

PDEMDHC said:

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Bocephus said:

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Market is Supposed to open down again. I'm betting it will go below 53

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51.65 while I type this. Was going to enter today and waiting on my adviser to call.

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why not wait until the technicals look a bit bitter?

Shiner Bock said:

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PDEMDHC said:

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Bocephus said:

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Market is Supposed to open down again. I'm betting it will go below 53

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51.65 while I type this. Was going to enter today and waiting on my adviser to call.

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why not wait until the technicals look a bit bitter?

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And that's what we just agreed upon, so thanks for the note. He doesn't believe we are near bottom. I'm now 30% in cash plus adding the max contribution for the year shortly. Going to wait and ride it down.

What's everyone's thoughts on EPD? 10.66 PE and 7.6% dividend yield at this price.

Just bought calls at 55

Grabbed some shares at 51 just now. Curious if it hits 50 today.

Edit: and it's on its way

Bought some more at 50 and still dropping. Bet it closes at 49ish

Dang $49.82 on the close never thought XOM would be in the 40s. This is nasty

Bought at $50 today.

Dan Scott said:

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Dang $49.82 on the close never thought XOM would be in the 40s. This is nasty

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This.
I don't think its been in the 40s as long as I've owned it

c/o 09 Ag in FW said:

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Dan Scott said:

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Dang $49.82 on the close never thought XOM would be in the 40s. This is nasty

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This.
I don't think its been in the 40s as long as I've owned it

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Maybe after a split.

Interesting theory.

https://www.google.com/amp/s/seekingalpha.com/amp/article/4326605-exxon-mobil-hyperinflation-hedge-extraordinaire

MsDoubleD81 said:

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c/o 09 Ag in FW said:

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Dan Scott said:

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Dang $49.82 on the close never thought XOM would be in the 40s. This is nasty

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This.
I don't think its been in the 40s as long as I've owned it

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Maybe after a split.

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Last time I bought it in the 40s was when it used to split. I made a lot of money on XOM back when it would split because you could automatically bank on it getting back to $80.

Hasn't been in the 40s since 2004. A 10-year T-bill will pay out 1.3%. One share of XOM pays out 6.9%.

Boat Shoes said:

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Bocephus said:

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Hasn't been in the 40s since 2004. A 10-year T-bill will pay out 1.3%. One share of XOM pays out 6.9%.

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That math only works if the share price doesn't keep falling.

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True, but I expect XOM to be back above 60 within a month or so

XOM Tangible value/share is $45. The market is then valuing the brand, IP, goodwill, etc. at $5/share. At the valuation it's like the market sees oil getting crushed further.

RDS ADR has an 8.5% dividend. What am I missing?

AgBank said:

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RDS ADR has an 8.5% dividend. What am I missing?

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Nothing

Energy - value trap of the last 10 years.

7% yield.... but they don't have any FCF yield. XOM has been outspending to pay their dividend at much higher prices than today.... and valuation on EV/DACF is NOT cheap...so just increasing leverage and if prices don't recover balance sheet is not in a great place

Guyana will turn FCF positive in a few years but Permian won't, and as others mentioned-the chems/downstream side of the business is not good...

If you just want energy yield I'd stick w/ EPD, can throttle down capex and doesn't have the base decline/high maintenance capex level as upstream

I personally think they need to throttle back their Permian position. The downstream needs cleaning up. I imagine they're going to announce a pretty big cost review/restructuring.

All A&M said:

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Xom has a high dividend payout ratio, over supply of oil, a lot of competition, low margins, and hasn't performed well for many years. If they are forced to cut the dividend (they are currently borrowing to keep the dividend intact and that has a limit), the stock will fall MUCH further. This is the main reason the price has decreased more than the oil sector. It's not the same Exxon from 20 years ago. Maybe the analysts are wrong and this is a great buy. Just consider some downside protection.

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Last time BHP was struggling in low commodity prices they cut their dividend and stock hit $20...within 2 years it was holding north of $40.

These majors have such large tier 1 assets that will weather the storm. Maybe XOM cuts div and trades below $40, it will be back above $70 within a few years.

The assets on their books are ripe for massive write downs and downward revisions due to ceiling tests and impairments.

They aren't too far away and will be brutal.

It's going to be a bumpy ride until 2022. However, I'm strongly of the opinion that we are going to see continued run off of shale production given what I'm seeing across the financing side of things. I'm not crazy about the shale spending but do still believe long term in some of the downstream investments even if near term issues.

Cyp0111 said:

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It's going to be a bumpy ride until 2022. However, I'm strongly of the opinion that we are going to see continued run off of shale production given what I'm seeing across the financing side of things. I'm not crazy about the shale spending but do still believe long term in some of the downstream investments even if near term issues.

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I agree with you.

I heard a figure this morning:

"64% of shale debt ($71bn) has to be refinanced in the next 5 years" - Danielle DiMartino Booth

Yep. Of current L48 unconventional production roughly 3.6Mbbls is from wells drilled within the last year. We are chewing through Tier 1 inventory in the Bakken, Eagle Ford and starting to roll over in both basins. The entire state of Oklahoma is a mess with people getting nailed in the Scoop/Stack, Merge/whatever names the okies gave.

This comes down to the Permian and you are starting to see issues pop up all over the place. You are seeing the public companies go into FCF mode which is hard at $50/2 price deck.Maintenance CAPEX is shooting up as companies are replacing their best wells with lower recovery stuff while knocking into existing wheels lowering pdp curves.

Capital is getting scarce and the mark downs of available inventories is just going to accelerate as people become realistic about capital efficiency vs. capital intensity.

I saw all of this as context of the bull case in the future for oil supply constraints. It's not that shale is fundamentally flawed. The current capital structure and how capital is allocated is flawed and the markets (public, debt, bank rbls and private equity) are largely shut.

Most small cap publics (or newly minted small cap hint WLL, OAS etc all) should not exist. Without the public exit to dump on retail the PE game doesnt work either.