May 17, 2013
Icahn and Transocean Come to Terms Over Board of Directors, Dividend Payment
 Legendary activist investor Carl Icahn has been tireless in 2013. The year kicked off with the unusually public conflict with fellow billionaire Bill Ackman over Herbalife (HLF), when the latter accused the company of being a pyramid scheme and devoted a whole presentation to explaining why the nutritional supplement company deserved to be shorted. Shortly thereafter, Icahn revealed a 13 percent stake in Herbalife, potentially saving the company’s shares. More recently there has been the as-yet unresolved battle over PC-maker Dell Inc. (DELL), whose founder Michael Dell has partnered with Silverlake Management in an attempt to take the company private in order to have greater control over a much-needed turnaround process. Icahn, who has a 4.5 percent stake in the company, has teamed up with Southwestern Asset Management, who has an 8.2 percent stake, to propose his second counter-offer to (more)…
May 15, 2013
America’s Addiction to Foreign Uranium
 What most Americans don’t realize is that dependence on foreign oil isn’t the main obstacle to US energy autonomy. If you think America’s energy supply issues begin and end with the Middle East, think again. One of the most critical sources of foreign energy is due to dry up this year, and the results could mean spiking electricity prices across the country. In 2011, the US used 4,128 billion kilowatt hours (kWh) of electricity. Nuclear power provided 790.2 billion kWh, or 19% of the total electrical output in the US. Few people know that one in five US households is powered by nuclear energy, and that the price of that nuclear power has been artificially stabilized. Unfortunately for us, the vast majority of the fuel used for powering our homes must be imported. In the chart below, you see where (more)…
May 6, 2013
Homeland Resources Makes an Entry into America’s Energy Boom
 Much of the talk over the past year about the revolution in North American production of oil and natural gas arrives in the context of the huge reserves slumbering underground at the Bakken formation beneath parts of Montana and North Dakota, or the Uticah and Marcellus shale formations in Ohio, Pennsylvania and New York. But as the United States embarks on its journey to become the world’s largest oil producer by 2020, according to the Energy & Commerce Committee, and even earlier than that according to the International Energy Agency, much less attention gets paid to smaller oil and gas plays throughout the country, and the smaller companies involved in exploring and drilling them. With its impressive work in Southern and Central Oklahoma, Homeland Resources (HMLA) is a perfect example of one such company. The Smoky Hill Project, initiated in 2010, has yielded (more)…
May 2, 2013
Valero Pops on Convenience Store Brands Spin-Off Debut
 Shares for Valero Energy (VLO) were up more than 4.6 percent on Thursday to $37.02 as the company’s plan to spin off its convenience-store business into a separate publicly traded entity became official. CST Brands Inc. (CST) is the name and ticker symbol of the new company that began trading today. It makes its debut on the market as North America’s second largest publicly traded convenience retailer. 2012 revenue for CST Brands alone was approximately $13 billion. The move comes as Valero’s first quarter earnings report from Tuesday showed the company bringing in a profit after Q1 2012 was hampered by costs of some $1.09 per share, resulting primarily from trouble at one of its refineries in Aruba. For the first quarter of 2013, Valero earned $654 million or $1.18 per share on revenue of $35.17 billion, versus the prior (more)…
April 26, 2013
Natural Gas and Crude Production Increases Help Chevron Top Analysts in First Quarter
 The Dow slipped into the red after a first-quarter gross domestic product in the U.S. failed to live up to expectations Friday morning, but is fighting its way back as the weekend approaches. Dow component Chevron Corp. (CVX) has been trying to do its part to buoy the industrial index after reporting profits in the first quarter that topped analyst predictions, despite lower oil prices chewing into its sales and earnings. From the start of 2013 to March 30, brent crude prices dropped nearly 5 percent to average about $112.6 per barrel. Total revenue for the quarter at San Ramon, California-based Chevron slid to $56.82 billion, down from $60.71 billion in the year prior quarter. Net profit for the quarter was $6.18 billion, or $3.18 per share, versus $6.47 billion, or $3.27 per share in Q1 2012. Analysts were expecting (more)…
How Did Big Oil Do In Q1?
 Some of the largest oil companies reported earnings on Thursday and Friday. The price-per barrel of oil was lower in the first quarter of 2013 compared to Q1 2012, which has had an industry-wide effect on profits. This has especially been the case for those companies who are not as well positioned to supplement the losses with natural gas and chemicals operations, with stockpiles down and the price of futures above the $4 dollar per million BTU mark for the past three weeks. Natural gas futures have more than doubled over the past year, while the price per barrel of oil has dropped 11 percent for the same time period. Here is a quick look at some of the results: Chevron (CVX) reported net income on Friday of $6.18 billion, or $3.18 per share on revenue of $56.82 billion, down (more)…
April 22, 2013
Halliburton Shares Spike on Earnings and Settlement Deal
 Shares for international oilfield services company Halliburton (HAL) were up over 5 percent on Monday, trading for as much as $39.41, after the company released its earnings report, and announced that it had been participating in an out of court settlement to deal with “a substantial portion” of private lawsuits relating to its role in the 2010 Gulf of Mexico oil disaster. Excluding expenses, most notably the $637 million the company set aside during the first quarter for legal expenses resulting from the private claims that have been brought against it, Halliburton reported earnings of $624 million, or $0.67 cent per share, on record Q1 revenue of $6.97 billion. This was well in front of analyst estimates that predicted earnings of $0.57 cents per share on revenue of $6.88 billion. Including expenses, however, the company reported a loss of $18 (more)…
ABB Agrees to Buy Power-One for Approximately $1 Billion
 In the first big merger news of the week, on Monday the boards of Zurich-based engineering company ABB Ltd. (ABB) and Power-One Inc. (PWER) have agreed to terms in which ABB will acquire renewable energy company Power-One for $6.35 per share in cash or $1.028 billion. The deal includes Power-One’s net cash of $266 million and is expected to close in the second quarter, pending customary approvals. The price is a 57 percent premium to Power-Ones closing price of $4.04 on Friday. ABB is the world’s largest provider of power grids and industrial motors, while Power-One is the second biggest manufacturer of solar inverters on the planet, creating a solid synergy for the combined firm as ABB bets that solar power will surge in the future in emerging markets and debt-riddled Europe as a way to combat rising traditional energy (more)…
Gross Domestic Product for the First Quarter to Highlight Week in Economic Data
 After recording its worst week of 2013 last week on the back of less-than-expected economic growth information from China, the S&P 500 will be looking for reasons to recover this week. There will again be an influx of financial reports and earnings season is now in top gear. Additionally, data from Washington will be delivered each day this week, capped off by the heavily watched first estimate of gross domestic product statistics from the first quarter. Market moving economic data from the States this week will include: Monday Existing Home Sales for March – In February, the National Association of Realtors said that sales of existing homes rose 0.8 percent to a 4.98 million annual rate while upwardly revising January’s figure from a 0.4 percent increase to a 0.8 percent increase. Inventory had been a big concern in recent months, (more)…
5 Natural Gas Exchange Traded Funds
 The U.S. Energy Department reported that natural gas supplies increased by 31 billion cubic feet last week, which, while shy of analyst expectations, marked the first storage increase of 2013. Meanwhile, unseasonably cold temperatures throughout the central United States are expected over the next two or so weeks. These two factors have much to do with why natural gas futures hit an intraday high of $4.335 per million BTU (British Thermal Units) on Thursday. Furthermore, natural gas has been immune to the savage beating that most commodities have taken over the past week. This situation is due in part to the much heralded “energy revolution” that is currently just beginning in the United States, as large reserves of shale-based oil and natural gas are being sought and discovered all over the country. But there is more to the story since, (more)…
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