Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (23525)	3/10/2006 9:17:57 PM
From: Broken_Clock	Read Replies (1) \| Respond to of 79291

I posted a chart over on BDBBR thread of CHK vs. PTEN. Any comments? it seems to me that Wall St. is more willing to hold companies that are hedged and are building reserves. Anything else is a short. -ng- Message 22249661

To: Spekulatius who wrote (23525)	3/10/2006 10:58:53 PM
From: gcrispin	Read Replies (1) \| Respond to of 79291

FWIW: Another opinion. By Deustche Bank ($55.85, March 7, 2006) THE TEMPTATION IS TO WANT to buy Chevron, with the last bulls having turned bearish and the stock offering the cheapest credible oil and gas reserves on Wall Street (at just $5 per barrel). For now, we retain a neutral view of the company, unchanged by its analyst day, which broadly speaking was in line with our expectations. A bull would argue that Chevron sandbagged its analyst meeting. First, it gave a deliberately low 3% growth target in volumes, despite a huge suite of projects that start growth delivery in 2007 and keep coming. Second, there was no grand outlook for reserves replacement despite a simply outstanding exploration record over the past five years. Third, the company has a fantastic exposure to growth oil-demand markets in Asia. Finally, there was only mumbled mention of a $5 billion buyback program over three years that could be done within one, implying $2 per share of yield, worth 4%, to add to 3.3% dividend yield this year. A bear would argue that the company's 2008 [production] target for three million barrels per day is the same as 2004; except the 400 kilo barrels per day that Unocal has been acquiring in the meantime. That represents a spectacular miss on a volume target. This meeting revealed yet more project slippage to major developments such as Agbami in Nigeria and Tengiz in Kazakhstan, combined with ever-higher capital-expenditure requirements. This struggle to successfully develop major projects -- brutally evidenced by the woeful actual reserves-replacement ratio reported with the Securities and Exchange Commission over the past two years -- indicates that the well-known massive resource potential of the company will not be exploited for good returns. Furthermore, capital expenditure is also up dramatically in the volatile downstream. Finally, and we are near-term bears, our first-quarter earnings-per-share number of $1.50, versus the Wall Street consensus [estimate that is] closer to $2.00, is terribly low. The key issues are horrible Asian refining and U.S. natural-gas prices far below fourth-quarter levels.