BloggingStocks

Obama's $1000 giveaway is a take away!

Sheldon Liber — 2008-08-08T15:41:00+00:00

Filed under: Rants and raves, Apple Inc (AAPL), General Electric (GE), Exxon Mobil (XOM), Johnson and Johnson (JNJ), Chevron Corp (CVX), ConocoPhillips (COP), Politics, Presidential elections, Oil, Headline news

If Barack Obama is receiving advice from "my pal Warren" then he must not be listening. There is no way that Warren Buffett, the national debt hawk, would support Obama's stupid idea of giving another $1,000 back to every family in America. It is reported that he would pay for this by creating a windfall profit tax on oil companies.

This give-away program is an attempt to buy votes plain and simple. It would add to the national debt, discourage oil companies from investing and worse it would handicap American companies more than others and mortgage more of our children's futures.

The last thing the the people of the United States need is more deficit spending. If we did tax oil companies, which I am against, I would only support using the funds for expanding education, research and development in science and engineering with the goal of maintaining our waning leadership in technology.

We need to do things that increase our productivity. Increasing our dependency on government handouts is a colossal mistake.

The so-called windfall profits of the oil companies is another thing I question. The profits are large because the demand is high and the gross receipts are high. It is simply a big number, not necessarily a high margin. When the profits were absent during periods of lower oil prices, nobody said anything.

Here are some net profit margin facts.

Three oil companies:

Exxon Mobile (NYSE: XOM) 11.32%
ConocoPhillips (NYSE: COP) 6.93%
Chevron Corp (NYSE: CVX) 9.16%

Three popular large non-oil companies in three different industries:

Apple Inc. (NASDAQ: AAPL) 14.56%
Johnson and Johnson (NYSE: JNJ) 17.31%
General Electric (NYSE: GE) 13.09%

I would much prefer to hear anything about balancing budgets, or even just slowing down spending, not more government taxing and spending. In the end Obama's give-away would be a take-away!

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of COP, GE, & JNJ.

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Brand Energy crafts an IPO

Tom Taulli — 2008-07-18T15:59:00+00:00

Filed under: Exxon Mobil (XOM), Chevron Corp (CVX), BP p.l.c. ADS (BP), Initial public offerings

For the most part, the IPO market has been a bust this year. But there are some bright spots - such as energy deals.

To this end, there was an interesting IPO filing this week: Brand Energy.

The company is a provider of multi-craft services for the downstream infrastructure space. Some of the offerings include: insulation, corrosion protection, weatherproofing, specialty coatings and so on. What's more, there are four major focuses: refining, Canadian Sands, petrochemical and power generations.

Brand Energy certainly has a sterling customer list, which includes biggies like BP (NYSE: BP), ExxonMobil (NYSE: XOM), Dow Chemical (NYSE: DOW) and Chevron (NYSE: CVX).

Essentially, a key advantage of Brand Energy is that the firm is a one-stop shop, which allows for more efficiency and speed. It also helps that there is a network of 202 service centers across North America.

No doubt, there are some big trends that should boost the long-term growth of Brand Power. For example, North America has an aging energy infrastructure (no refinery has been built since 1976); the quality of global crude feedstocks has fallen over the past 20 years (which leads to more corrosion and wear and tear); increasing regulations; and capital infusions in the Canadian Oil Sands.

In fact, it looks like the addressable market opportunity for Brand Power is about $25 billion. Moreover, the company generates pro forma revenues of about $1.4 billion (there are more than 175 long-term customer contracts and the average renewal rate is above 90%)

The lead underwriters on the IPO include Goldman, Sachs & Co. (NYSE: GS), UBS Investment Bank (NYSE: UBS) and Morgan Stanley (NYSE: MS). You can also locate the prospectus at the SEC's website.
Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

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Market gets crushed by Fannie, Freddie and oil concerns

Jonathan Berr — 2008-07-11T12:57:00+00:00

Filed under: Apple Inc (AAPL), General Electric (GE), Exxon Mobil (XOM), Anheuser-Busch Cos (BUD), Chevron Corp (CVX), Merrill Lynch (MER), Federal Natl Mtge (FNM), Goldman Sachs Group (GS), Lehman Br Holdings (LEH)

The markets are imploding today amid fears which Citigroup says are unfounded that Fannie Mae (NYSE:FNM ) and Freddie Mac (NYSE: FRE) may not have enough capital to withstand the crisis in the housing market and continued worries about oil prices prompted by missile tests by the government of Iran. This is not just a perfect storm; it's a perfect season of calamities.

Want to know how bad it is? Apple Inc. (NASDAQ: AAPL) shares are down on the day the geeks around the world are waiting in line for the new iPhone, which has gotten rave reviews. Amazing. If people are looking for an excuse to buy Apple, this may be it.

Other stocks that seem to be doing well are Anheuser-Busch Cos. (NYSE: BUD) because InBev raised its unsolicited offer, and General Electric Co. (NYSE: GE), whose in-line quarter was greeted by cheers by Wall Street.

But the bad news is outweighing the good for now. Financial stocks are getting slaughtered because of Fannie and Freddie and probably will continue to do so for a while. Shares of Lehman Brothers Holdings Inc. (NYSE: LEH) are getting crushed, plunging more than 20%. Goldman Sachs Group Inc. (NYSE: GS) and Merril Lynch & Co. (NYSE: MER) are both down more than 5%.

Even oil stocks such as Exxon Mobil (NYSE: XOM) and Chevron Corp. (NYSE: CVX) got hammered as investors figured that people who can't afford their mortgages probably won't be filling up their gas tanks, either. Good theory, I suppose.

So now that the Dow has dipped below 11,000. What's psychological barrier will fall next? 10,000? Stay tuned investors, things are about to get interesting.

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Transocean (RIG): Shares rise in positive trading channel

Larry Schutts — 2008-06-24T08:39:00+00:00

Filed under: Good news, Chevron Corp (CVX), BP p.l.c. ADS (BP), Technical Analysis, Stocks to Buy

Transocean (NYSE: RIG) is the world's largest offshore drilling contractor and a leading provider of drilling management services worldwide. The company owns, or operates, a contract drilling fleet of 138 mobile units, including 39 high-specification floaters, 29 midwater floaters, 10 high-specification jackups and 56 standard jackups. It operates in the world's major offshore oil-producing regions, including the Gulf of Mexico, the North Sea, Canada, the Middle East, Brazil, Africa and Asia. Chevron (NYSE: CVX), BP (NYSE: BP) and Petroleo Brasileiro (NYSE: PBR) are major customers.

The stock has been a steady gainer, since the January market downdraft, advancing on word of solid quarterly results, new and renewed contracts and optimistic analyst remarks. Essentially, a global shortage of deep-water drilling units has established a long-term, favorable pricing environment for the company.

The news has kept RIG shares cycling through a positive, 20-week trading channel. The price is currently rebounding from the base of that channel, suggesting the potential for a rise back toward the top.

Brokers recommend the issue with twelve "strong buys", thirteen "buys", eight "holds" and four "underperforms". Recent price targets are in the $160-$201 range. Analysts see a 29% average annual growth rate, through the next five years. The RIG P/E ratio (9.79), PEG ratio (0.36), Price to Book ratio (3.57), Sales Growth rate (134.19%), EPS Growth rate (50.20%), Return on Assets (10.32%), Return on Investment (18.52%) and Return on Equity (36.46%) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 90% of the outstanding shares. The stock is one of those used to calculate the S&P 500 Index. Over the past 52 weeks, it has traded between $92.61 and $163.00. A stop-loss of $134.00 looks good here. Note that the firm is expected to report fiscal Q2 results in early August.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.

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Oil rises to $137 as traders emphasize Nigeria concerns over Saudi output hike

Joseph Lazzaro — 2008-06-23T13:40:00+00:00

Filed under: International markets, Chevron Corp (CVX), Commodities, Oil

Oil rose over $137 Monday after traders calculated that Saudi Arabia's announced production increase will not be able to replace production disruptions in Nigeria, Bloomberg News reported.

Oil rose $2.20 to $137.56 per barrel in Monday mid-day trading. The other major energy commodities also rose on the news. Heating oil jumped 8 cents to $3.85 per gallon, unleaded gasoline gained about 4 cents to $3.47 per gallon, and natural gas climbed about 23 cents to $13.22 per million BTUs.

Attacks on a Royal Dutch Shell (NYSE: RDS.A) platform and a Chevron (NYSE: CVX) pipeline last week halted production of 300,000 barrels of oil per day from Nigeria, Bloomberg News reported. The Nigerian unrest easily offset Saudi Arabia's announcement, at the Jeddah summit it hosted, that it would pump an additional 200,000 barrels per day.

Oil's 'safety cushion' is low

Jim Dietz, independent energy trader, told BloggingStocks Monday, a weak dollar and speculator long positions have been factors in oil's more than 4-year bull market, but the No. 1 factor, in his interpretation, is the low 'safety cushion' between daily global oil supply and demand.

"This [oil] market remains driven by demand and the low safety cushion. The safety cushion is now roughly half what it historically is, so any disruption anywhere in the world creates the potential for oil shortages. That's why oil is $137 a barrel," Dietz said. "We get a flair up anywhere in the world, such as Nigeria, and all of sudden there could be not enough oil to go around. It's a scary scenario." Dietz added that he is presently long with oil and unleaded gasoline, with monthly contracts.

Daily global oil demand was estimated to be 86.6 million barrels per day for Q1 2008, while global oil supply was 87.2 million barrels per day, according to data complied by the International Energy Agency.

Dietz said a meaningful, sustained price decline in oil can oil occur only after global demand declines, and the safety cushion increases. "It doesn't look like the supply side will be able to do it and eliminate shortage fears," Dietz said. "When China and India start consuming less oil, year-over-year, that will be the market's cue to take oil prices lower, not before."

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Donald Trump: Big oil is naughty

Gary E. Sattler — 2008-06-18T14:16:00+00:00

Filed under: Exxon Mobil (XOM), Chevron Corp (CVX), BP p.l.c. ADS (BP), Media World, Oil

As if this country doesn't have enough to worry about, now Donald Trump says that oil companies such as BP (NYSE: BP), Chevron Corp. (NYSE: CVX), and Exxon Mobil Corp. (NYSE: XOM) are ripping us off. According to a story from CNBC, Trump is calling for punitive sanctions against oil companies, citing their historic profit levels.

While calling himself a "great capitalist" and stating that it is against his nature to seek punitive sanctions against companies that are reaping big profits, Donald Trump indicated that it is his opinion that oil companies have been ripping off the world for quite some time. In a statement aired by CNBC, Trump said, "I can see doing something against the oil companies."

I think it takes a lot of gall for a self made opportunistic capitalist to point fingers at companies which might play the game a little better than he does. Trump knows the rules and he knows where the power resides. He should also know that if changes in the movement of oil money need to take place, those changes should start with the government's already too large part of that money. Donald Trump must be aware that any adjustment to oil company revenue percentages will simply be handed off to consumers. So what is Donald really saying?

If Mr. Trump truly wishes to help the situation, then he should be standing in front of the White House demanding that taxes already levied on oil profits should be used to subsidize diesel fuel for commerce transport until the oil market stabilizes itself. Anything less is just one speculator shaking his fist at a wagon full of speculators. As a somewhat questionable performer in that regard, perhaps Mr. Trump should just pay closer attention to what's going on in his own little backyard.

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Are we in for Bush vs. Carter, and what stocks would fare better under each?

Sheldon Liber — 2008-06-11T15:45:00+00:00

Filed under: Rants and raves, Cisco Systems (CSCO), Pfizer (PFE), Coca-Cola (KO), Exxon Mobil (XOM), JPMorgan Chase (JPM), Adobe Systems (ADBE), Automatic Data Proc (ADP), Avon Products (AVP), Black and Decker (BDK), Chevron Corp (CVX), Costco Wholesale (COST), Goldman Sachs Group (GS), Cardinal Health (CAH), Kraft Foods'A' (KFT), Politics, Suntech Power Hldgs ADS (STP), General Dynamics Corp (GD), Northrop Grumman (NOC), Raytheon Company (RTN)

For the first time Monday I heard John McCain comparing Barack Obama to Jimmy Carter. I had heard this before in other arenas, but not from McCain. I guess that despite these two presidential candidates pledging to the American people to bring change and resist politics as usual, they are both, as usual as one could get.

Obama is being shaped by the pressures of running for office and to believe otherwise is delusional. I suppose one has to have hope but the effects of the campaign are becoming clear. Obama has been painting McCain as an extension of Bush, which is nonsense, and now in a typical tit-for-tat response, McCain is filling the air with Carter references.

Both McCain and Obama are wrong in their assessments of their opponents and they are becoming commoners to resort to the bottom of the barrel campaign techniques used in every campaign for most of our nation's proud history. Obama gave up the high ground too easily and McCain has decided he can sling mud with the best of them.

Stick to the issues fellas, or neither one of you will have any credibility left to fight the inflation, sinking dollar, war, oil & food prices, federal deficit, trade imbalances, national infrastructure, health care and Social Security nightmares and a multitude of other issues one of you will be saddled with.

How will either affect stock prices. The market is full of assumptions. If McCain wins, the defense sector, energy, health care, financials and high yielding stocks are probably better bets. Some examples are:

If Obama wins, better bets might be alternative energy, high-tech, consumer staples, retail and non-dividend paying stocks (think taxes). Some examples are:

These are just a few stocks from among those that have been reviewed on BloggingStocks and not current recommendations. They are just meant to give a little flavor to what I sense as market sentiment, and to stimulate some discussion.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money.

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Head for the exits on integrated oil stocks from TheStreet.com

Eliza Popescu — 2008-06-09T15:46:00+00:00

Filed under: Forecasts, Exxon Mobil (XOM), Chevron Corp (CVX), BP p.l.c. ADS (BP), Economic data, Oil

With the oil prices moving a lot from one day to the next, many of us are left wondering what could be the best solution when investing into an oil stock: buying it or selling it. As Eric Bolling underlines in TheStreet.com, last week was the first time during the past months when selling was seen as the best option.

The reverse side came on Thursday when the European Central Bank President Jean Claude Trichet warned about possible losses. After announcing that nothing changed for the ECB interest rate policy, Trichet said that the ECB might raise their interest rates which are already hitting high levels.

Last week's oil move proved that even oil prices can be manipulated in their rally. It looks like a few comments added at the right time can dramatically change the course of events. Congressman Bart Stupak's comments that he found nothing illegal going on in the oil price rise were enough to make new longs raise the price $5.49 per barrel for the first time ever.

Then, crude oil prices were given another boost when a Morgan Stanley analyst announced he expects oil prices to hit $150 by July 4, of this year. This came on the heels of rumors that we may see an attack on Iran in response to the country's refusal to accept United Nations' resolutions regarding their uranium enrichment program. All said and done, oil prices made a pretty remarkable 8.8% price gain during the week.

Taking a look at the current oil crisis, Sen. Barack Obama is thinking about an alternative to fix the problem... and this could be by using subsidies to the alternative energy world. However, investors should keep the attention on oil stocks as many other opportunities to make money could come. As Bolling underlines, this could involve selling positions in companies such as BP (NYSE: BP) or Exxon Mobil (NYSE: XOM), or keeping positions in stocks like Chevron (NYSE:CVX) which is seen as the best company on earth.

Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.

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Companies that vanished: Standard Oil -- one giant becomes three

Peter Cohan — 2008-06-09T12:50:00+00:00

Filed under: Competitive strategy, Exxon Mobil (XOM), Chevron Corp (CVX), ConocoPhillips (COP)

This post is part of a series on some of the most memorable companies that have disappeared.

Standard Oil (1870 - 1911) was the dominant oil company in the world until it was felled by the Sherman Anti-Trust Act of 1890. John D. Rockefeller was a business genius of the first order. He used his control over train routes and refineries to buy up oil wells and block competitors from taking market share.

Thanks to journalist Ida Tarbell, Rockefeller's rough business tactics got plenty of publicity. In 1911, the Supreme Court ruled that Standard Oil had violated the Sherman Anti-Trust Act through its tactics of using low prices to wipe out competitors. The result, as chronicled in one of my favorite books, Ron Chernow's Titan, was a breakup of the company into what is now Chevron (NYSE: CVX), Exxon Mobil (NYSE: XOM), and ConocoPhillips (NYSE: COP).

The lesson: What didn't kill Standard Oil made its offspring stronger.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter.

Let us know in the comments what you miss about Standard Oil. And be sure to check out other Companies That Have Vanished.

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Cramer on BloggingStocks: Oil stocks + dividends = good times

Jim Cramer — 2008-06-03T09:33:00+00:00

Filed under: Exxon Mobil (XOM), Market matters, Chevron Corp (CVX), ConocoPhillips (COP), Oil, Stocks to Buy, Cramer on BloggingStocks

TheStreet.com's Jim Cramer says the companies could deliver money to shareholders without sacrificing growth.

What happens if the oil companies start actually recognizing their good fortune -- their sustainable good fortune -- and start boosting dividends the way that Tidewater (NYSE: TDW) (Cramer's Take) did last week with its 67% hike.

Throughout this great run with oil and gas, it seems that the companies themselves haven't caught up with the good fortune. They haven't spent that much on drilling relative to profits, and they have chosen to buy a lot of stock back, never bad. But what if they start returning the profits to shareholders in the form of dividends?

I think that what could happen is that you wouldn't think that Chevron (NYSE: CVX) (Cramer's Take) and Occidental Petroleum (NYSE: OXY) (Cramer's Take) and Exxon (NYSE: XOM) (Cramer's Take) are such nose-bleeders.

If you go back and look at the presentations of Conoco (NYSE: COP) (Cramer's Take) -- a very pro-shareholder company -- you'll see how the dividend could be boosted hugely without hurting the growth of the company.

I am betting that Tidewater may not be an isolated example. This group could provide a lot of good dividend news this year, another reason that if and when oil comes back to $120 -- where I think it will go before going over its previous highs -- you want to buy the stocks, not sell them.

RELATED LINKS:

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer had no positions in the stocks mentioned.

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Cramer on BloggingStocks: The ultimate burden of proof: profit

Jim Cramer — 2008-05-28T09:00:00+00:00

Filed under: Google (GOOG), Apple Inc (AAPL), Dell (DELL), Exxon Mobil (XOM), Market matters, Chevron Corp (CVX), ConocoPhillips (COP), Research in Motion (RIMM), BP p.l.c. ADS (BP), salesforce.com inc (CRM), Stocks to Buy, Stocks to Sell, Cramer on BloggingStocks

TheStreet.com's Jim Cramer says observers demand perfection, but the arrows slung at diverse thinking offer lessons in making money.

The level of perfection people demand, the level of performance they say they demand, the insistence on making money in any particular way, these are all part of what it is like to be, well, me.

One of the best calls I have ever had was with Apple (NASDAQ: AAPL) (Cramer's Take). It was a happenstance call, as so many really are but pros won't admit that because well, then why pay them? My daughter wanted a second iPod because she had a pink one and needed a blue one. It was that "fashion statement" wakeup call that told me the numbers for iPods in the analysts' reports were way too low.

I pushed the stock hard everywhere. When I got my own show on CNBC, I endlessly lauded Apple in the $70s, $80s and $90s, and made a major statement when I included it in my Four Horsemen of Tech.

At the end of the year I took it off the list, as I did with all the Horsemen except Research In Motion (NASDAQ: RIMM) (Cramer's Take). The $198 price reeked of greed.

I got back on the stock when it hit the $120s. Again, happenstance. This time the iChat camera in my daughter's room after she insisted I get rid of the Dell (NASDAQ: DELL) (Cramer's Take) and go for the Mac. When word came down that the new iPhone would possibly include iChat, I went out and said, when it was in the $150s, that I didn't care about price, I just cared about the time frame of the launch of the new iPhone and I would sell it into the launch. Some right before, some during and some after, and maybe to leave a quarter on, maybe not. I said last night to sell the last quarter the day after, but it might be worth keeping. I hadn't made up my mind yet.

Why go over this litany? Because yesterday I was accosted by some fellow who was in disbelief that I recommended selling the stock. He wanted to know why I didn't just say buy and hold, because here it is back where I told people to sell it last December -- if they had done nothing, they would have done well.

I had just finished my show, and frankly I wasn't in the mood to debate it. But the guy was insistent that I hadn't done the right thing.

I told him, OK, on at $70, off at $190; on at $120, back to $185. How in heck could you be better than that?

He insisted that all I did was trade it. That trading was really unnecessary. I went through the arithmetic. With my suggestions you picked up 120, (190 minus 70 basis) and then an additional 65, so you got 185 points. With his method, he only got 115.

He suggested my method was riskier. I said that the riskiest thing to do was to ride $190 back to $120 and give up more than half your gain. He said it didn't turn out that way. Buy and hold "kept you in."

Finally, I said, forget Apple. If you can make 185, isn't that better than 115?

He said, "They are both good."

I gave up.

This can be an impossible business.

Most stocks, the vast majority, have stunk for several years now. Stocks have stunk as an investment unless you nailed the sector, and the sectors have been agriculture, infrastructure, minerals, defense and oil and gas, and Apple, Google (NASDAQ: GOOG) (Cramer's Take), RIMM and Salesforce.com (NYSE: CRM) (Cramer's Take).

Some scattered takeovers. Otherwise, that's it.

And even when you nail it, as I did with Apple, it isn't enough.

This weekend a guy came up to me at a restaurant in Allenhurst, N.J. I was minding my own business, trying to eat. The guy told me that he had all oils, that he had made millions of dollars, that he had Chevron (NYSE: CVX) (Cramer's Take), Exxon (NYSE: XOM) (Cramer's Take), Conoco (NYSE: COP) (Cramer's Take), BP (NYSE: BP) (Cramer's Take). I think he may have been implying that I helped him, but I am not sure.

Anyway, I told him that he should sell some, that those gains could not be sustainable. I told him that I had sold my BP.

He told me I didn't know what I was talking about. That these were up stocks.

Here's my conclusion. I know what I am talking about. This is a really horrid, crummy market, where the gains are all hardscrabble and can be ephemeral. Taking them is the only sure thing. You don't have to take all of them but you have to take some of them.

Oh, and here's another take. In the end, nobody cares what anybody else says when they are winning. The Apple guy and the oil guy are winning. They are geniuses. The rest of us are idiots.

Just like we were in March 2000. Maybe we were even more stupid because we liked them in February 2000 (much-reviled mind change when the Nasdaq moved up several thousand points in a couple of months.)

Last conclusion: I like being stupid and an idiot. It is why I have made a lot of money.

RELATED LINKS:
Cramer's 'Mad Money' Recap: Wade In with Kaydon
Top Ten Most Searched Stocks on TheStreet.com

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long ConocoPhillips.

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Google (GOOG) and Chevron (CVX) light up solar

Douglas McIntyre — 2008-05-27T08:48:00+00:00

Filed under: Products and services, Google (GOOG), Chevron Corp (CVX), Suntech Power Hldgs ADS (STP)

Solar energy may be the wave of energy's future, but companies such as Google (NASDAQ: GOOG) and Chevron (NYSE: CVX) may best start-ups in getting to the benefits. A number of large American companies with tremendous balance sheets are pouring money into solar energy based on the fact that it is becoming more competitive with oil.

According to Bloomberg, "Costs for the technology will fall below coal as soon as 2020, the U.S. government estimates. JPMorgan Chase & Co. and Wells Fargo & Co. invested last year in the biggest solar plant built in a generation; Chevron and Google are funding research; and Goldman Sachs is seeking land to lease as demand out-paces wind turbines and geothermal."

Given the potential size of the bonanza, the investments should not be surprising, but they could squeeze smaller solar energy companies out of the market. Firms like JA Solar (NASDAQ: JASO) and SunTech (NYSE: STP) have their entire futures bet on the success of solar energy and the fact that there are not many companies in the business, at least until now.

It has began to occur to large companies that if fossil fuels will indeed start to run low in two or three decades that the trillions of dollars in market cap currently represented in large oil company stocks will have to go somewhere.

Why not to Google?

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Cramer on BloggingStocks: This market's beyond the fundamentals

Jim Cramer — 2008-05-23T09:09:00+00:00

Filed under: Exxon Mobil (XOM), Market matters, Citigroup Inc. (C), Chevron Corp (CVX), Wachovia Corp (WB), Cramer on BloggingStocks

TheStreet.com's Jim Cramer says they're lousy, so traders have to turn to things like the oscillator for guidance.

Boy, it's tough to find something to like here.

It's tough to even find a thesis.

The litany seems worse than ever: autos falling apart, oil perhaps peaking, volume drying up, mergers falling apart, credit losses back again, lay-offs rising.

To which I say, of course. No kidding. We had a big run up, and when we got there things turned for the worse, not for the better. When that happens you can't fall back on the fundamentals, which are bad and have been bad for what seems like ages, but instead have to fall back on things like the oscillator and the bull/bear ratio. We got very overbought and we lost a lot of bears on that assault on 13,000, and we saw financials, techs, oils, utilities and industrials go for a ride. In the end, even retail had a romp.

Now all of that has to get repealed, even energy for a bit because this last spike to $130 and change was too much too fast even if we ultimately get to this level not far down the road.

I think that until we get to some level that is significantly negative on the oscillator and lose a lot of bulls it doesn't even matter what you buy, you can buy Chevron (NYSE: CVX) (Cramer's Take) and Exxon (NYSE: XOM) (Cramer's Take), or you can buy Citigroup (NYSE: C) (Cramer's Take) and Wachovia (NYSE: WB) (Cramer's Take), you are not going to make any money. And you can lose some.

It's so dicey that only the tobaccos and a couple of the packaged goods stories may hold up. So why even bother.

In other words, it is just the usual end-of-the-world story. Let it play out, until it doesn't, and at lower levels the bargains will be back.

Random musings: Oil is easy at this point. People are either going to change their behaviors and the inventories worldwide will build -- its been made difficult by the Iranian hoarding -- or they won't and gasoline goes to $6.

RELATED LINKS:
Oil's Surge Just Getting Started
Crude Oil Ends Record Five-Day Climb

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer had no positions in the stocks mentioned.

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Before the bell: Futures higher as oil bursts through $135

Melly Alazraki — 2008-05-22T07:49:00+00:00

Filed under: Before the bell, Exxon Mobil (XOM), Market matters, Chevron Corp (CVX), ConocoPhillips (COP), Amer Intl Group (AIG), BP p.l.c. ADS (BP), Economic data, Oil

Stock futures were a little higher early Thursday morning as stocks seemed poised for a rebound after plunging the last two straight sessions and as oil crossed $135 per barrel.

On Wednesday, U.S. stocks dropped sharply, again, as oil continued to rally, breaking new highs throughout the day and as the FOMC minutes indicated the Federal Reserve expects higher inflation and slower economic growth. The Dow industrials finished the day down 227 points, or 1.77%, the same as the Nasdaq Composite which lost 43 points, and the S&P 500 declined 22 points, or 1.61%.

Not much economic news today except for weekly jobless claims, but no doubt investors will continue to focus on the surging price of oil, now blamed also on Wall Street as traders are scrambling to cover bets. Oil prices rose above $135 to $135.09 a barrel for the first time Thursday, as supply concerns continued increased with reports that the International Energy Agency would cut its supply predictions. Even with assumption that global demand possibly weakening, the weakening U.S dollar drove crude futures up. Still, some blame the oil's rally due to traders covering wrong-way bets that prices would decline and buying crude, according to data from the New York Mercantile Exchange.

Executives of the five big oil companies, Exxon Mobil Corp (NYSE: XOM), Chevron Corp (NYSE: CVX), ConocoPhillips (NYSE: COP) and the U.S. subsidiaries of BP Plc (NYSE: BP) and Royal Dutch Shell (NYSE: RDS) will appear before congress for the second day as gas prices hit yet another high. No doubt, with crude above $135 a barrel, their excuse of market forces rather than profiteering will sound that much better.

Also in the headlines this morning is the power sector with NRG Energy (NYSE: NRG) offering Wednesday to buy rival Calpine (NYSE: CPN) for about $11.3 billion in stock.

American International Group (NYSE: AIG) can sigh in relief as Standard & Poor's, which ended its review of the company's debt due to its plan to raise capital is no longer considering downgrading it.

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Cramer on BloggingStocks: Oil's not the widespread tax it used to be

Jim Cramer — 2008-05-19T09:22:00+00:00

Filed under: General Electric (GE), Exxon Mobil (XOM), Market matters, Halliburton (HAL), Schlumberger Limited (SLB), Alcoa Inc (AA), Archer-Daniels-Midland (ADM), Bank of America (BAC), Boeing Co (BA), Chesapeake Energy (CHK), Chevron Corp (CVX), duPont(E.I.)deNemours (DD), Office Depot (ODP), Deere and Co (DE), Honeywell Intl (HON), United Technologies (UTX), Eaton Corp (ETN), Anadarko Petroleum (APC), Oil, Stocks to Buy, Burlington Northern Santa Fe (BNI), Norfolk Southern Corp. (NSC), Union Pacific Corporation (UNP), Cramer on BloggingStocks, Potash Corp. of Saskatchewan (POT)

TheStreet.com's Jim Cramer says lots of companies now thrive with crude up here.

Oil's not a tax on everything -- it's a tax on the consumer. That's what I come down to when I see the charts this weekend and ponder what's happening in so much of industrial America.

Company after company that I examine -- the new techs, as I call them -- actually benefit from higher oil prices. Or they can pass them on with ease, because of the worldwide demand being so strong.

Take all of the companies involved with making a Boeing (NYSE: BA) (Cramer's Take): Boeing itself, Alcoa (NYSE: AA) (Cramer's Take), Honeywell (NYSE: HON) (Cramer's Take) and Precision Castparts (NYSE: PCP) (Cramer's Take) being good examples. Each of these is necessary because the new Dreamliner burns lots less fuel, and with fuel the biggest airline cost, it stands to reason that higher energy prices make the plane more desirable even at a higher price point.

Or how about all of the companies involved with process and flow control and efficient motors: Parker-Hannifin (NYSE: PH) (Cramer's Take), Emerson (NYSE: EMR) (Cramer's Take), Eaton (NYSE: ETN) (Cramer's Take) and Flowserve (NYSE: FLS) (Cramer's Take). Those work higher with higher energy prices. CSX (NYSE: CSX) (Cramer's Take), Burlington Northern (NYSE: BNI) (Cramer's Take), Kansas City Southern (NYSE: KSU) (Cramer's Take), Union Pacific (NYSE: UNP) (Cramer's Take) and Norfolk Southern (NYSE: NSC) (Cramer's Take) are smaller energy users than trucks, and they ship plenty of ethanol and fertilizer.

Of course everything farming: Deere (NYSE: DE) (Cramer's Take), Monsanto (NYSE: MON) (Cramer's Take), Du Pont (NYSE: DD) (Cramer's Take), AGCO (NYSE: AG) (Cramer's Take), Potash (NYSE: POT) (Cramer's Take), Agrium (NYSE: AGU) (Cramer's Take), Mosaic (NYSE: MOS) (Cramer's Take) and Archer Daniels (NYSE: ADM) (Cramer's Take) (these are big companies in market cap now, powers of the S&P or companies just waiting to get into the S&P but stalled by a lack of mergers). And everything that drills, ships and transports oil and gas: Rowan (NYSE: RDC) (Cramer's Take), Parker (NYSE: PKD) (Cramer's Take), Weatherford (NYSE: WFT) (Cramer's Take), Cameron (NYSE: CAM) (Cramer's Take), Noble (NYSE: NE) (Cramer's Take), Transocean (NYSE: RIG) (Cramer's Take), FMC Tech (NYSE: FTI) (Cramer's Take), Oceaneering (NYSE: OII) (Cramer's Take) and so many others -- and of course, Halliburton (NYSE: HAL) (Cramer's Take) and Schlumberger (NYSE: SLB) (Cramer's Take).

And then there is oil and gas itself, ever a larger portion of the S&P. Look at the charts during last week's run: Apache (NYSE: APA) (Cramer's Take), Anadarko (NYSE: APC) (Cramer's Take), Nabors (NYSE: NBR) (Cramer's Take), Exxon (NYSE: XOM) (Cramer's Take), Chevron (NYSE: CVX) (Cramer's Take), Occidental (NYSE: OXY) (Cramer's Take), XTO (NYSE: XTO) (Cramer's Take), Southwestern (NYSE: SWN) (Cramer's Take), Chesapeake (NYSE: CHK) (Cramer's Take), Ultra (NYSE: UPL) (Cramer's Take): these all count.

Coal, of course, is a huge beneficiary. Infrastructure works because these companies get the benefits of the oil companies' largesse by being able to build energy-related production centers.

Even the autos can be viewed as benefitting, as the newer cars use less gas than the old ones, making them viable alternatives in multiyear paybacks. Along those lines, energy-efficient appliances get a boost.

Then there are the myriad energy-alternative plays that are always dominating the headlines but haven't yet made it into the S&P or are very small parts of the S&P: the wind plays -- Trinity (NYSE: TRN) (Cramer's Take), Woodward Governor (NASDAQ: WGOV) (Cramer's Take), Owens Corning (NYSE: OC) (Cramer's Take) (also insulation); solar -- First Solar (NASDAQ: FSLR) (Cramer's Take) ($24 billion market cap), SunPower (NASDAQ: SPWR) (Cramer's Take), and all the Chinese plays that people love so much.

Pipelines galore: Kinder Morgan (NYSE: KMP) (Cramer's Take), Enterprise (NYSE: EPD) (Cramer's Take), Boardwalk (NYSE: BWP) (Cramer's Take), so many others.

Many companies are neutral -- financial, telco, utilities -- although some benefit from the price umbrella of higher oil costs and can pass on costs they don't have. Tech's been fairly neutral. The weaknesses we have seen in tech are related to consumer slowdown (customers such as Office Depot (NYSE: ODP) (Cramer's Take)) or financial. Media's neutral, too. Health care can't be considered a negative either when it comes to energy consumption.

Most of the conglomerates say they are energy-positive: United Tech (NYSE: UTX) (Cramer's Take) and, famously, GE (NYSE: GE) (Cramer's Take), which has said that its fortunes should improve as oil goes higher, although we haven't seen that yet.

We know there are plenty that don't. Anything that is sold in the supermarket. Anything retail. Anything that uses oil or natural gas and can't really pass it on: Minerals and mining (although global demand really helps), glass (although recycling really helps, as in the case of Owens-Illinois (NYSE: OI) (Cramer's Take)), and chemicals and the paper producers.

But those companies aren't that important anymore, even though they dominate the consciousness of the marketplace, despite the encroachment of energy as a part of the S&P 500.

In fact, if finance could turn itself around -- something that seems increasingly possible, although it has sucked up a huge amount of capital and done nothing -- you could argue that we are on the cusp of a major move as it dawns on people that energy isn't the tax it used to be.

There are plenty of 30,000-foot flaws to this. We have seen time and again that our own growth in this country is heavily consumer-related. But the industrial growth owes itself not to the U.S. consumer, but the worldwide consumer.

All of these facts can go far toward explaining how higher oil prices have not been able to block the advance of the S&P or the Dow Jones averages. In fact, if the latter were more responsive to energy -- the Chevron nod was accompanied by ne'er-do-well Bank of America (NYSE: BAC) (Cramer's Take) instead of a Deere or another oil play like an Occidental or a Schlumberger -- we would be taking out 13,000 with ease.

All of this is worth thinking about when you are gloomy, because it doesn't add up to a decline, it explains the advance.

Keep it in mind during the next downturn. It explains a lot why they've been fairly shallow.

And I don't expect anything deeper now that finance seems to have stabilized.

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Gay investors support gay-friendly corporations

Gary E. Sattler — 2008-05-17T08:40:00+00:00

Filed under: Apple Inc (AAPL), International Business Machines (IBM), Aetna Inc (AET), Chevron Corp (CVX), Politics, Headline news

Conservative social and political groups are vowing to fight the recent California ruling in which a republican-dominated court declared that sexual preference should not bar couples from legal marriage. In an Associated Press article, the court opinion is quoted as stating that "domestic partnerships that provide many of the rights and benefits of matrimony are not enough."

In pursuance of equal footing, gay, lesbian, and bisexual investors have been seeking and "outing" corporations with gay-friendly policies and have been backing those companies in a show of financial clout. An example of the application of this forward social dynamic would be Trillium Asset Management, which has at least once scored a "perfect 10" on the Gay and Lesbian Values Index (glvindex). With an investment focus called Socially Responsible Investing (SRI), this company seeks to provide investment returns in keeping with industry standards, while at the same time maintaining "unique focus on social research and advocacy."

Corporations that have taken careful strides to bring their standards up to date with regard to societal equality appear to be gaining in popularity with gay and gay-friendly investors, as evidenced by their placement on and recognition of the glvindex. SC Johnson acknowledged it's high ranking on the glvindex in a company press release that stated in part: "To us, diversity is about building the best, most talented workforce that mirrors the marketplace, and motivating them with an environment that enables people to be themselves and contribute freely and effectively."

Some other big names have gained recognition as gay-friendly corporations, including Aetna Inc. (NYSE: AET), Apple Inc. (NASDAQ: AAPL), Chevron Corp. (NYSE: CVX) and IBM (NYSE: IBM). These companies, and dozens of others like them, have chosen to adopt policies that recognize the realities of social diversity. While the majority of these companies are not outwardly expressive of their atmosphere of tolerance, they nonetheless have brought their standards up to date. A comprehensive list of America's top 100 gay and lesbian friendly corporations can be found at WorldNetDaily.com.

It's a new world out there, and same-sex couples are demanding to have their equal part of it. Whether you like it or not, homosexuality is a powerful reality of our world. Gays, lesbians and bisexually oriented people are here to stay, and they want you to know that this is their world too. Now, let's all just get over it and let's move on, shall we?

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Analyst upgrades: ELOS, CEL, GMT and TNS

Eric Buscemi — 2008-05-15T10:54:00+00:00

Filed under: Analyst reports, Analyst upgrades and downgrades, Chevron Corp (CVX)

MOST NOTEWORTHY: Syneron Medical, Cellcom Israel, GATX Corp and TNS, Inc were today's noteworthy upgrades:

Merriman upgraded shares of Syneron Medical (NASDAQ:ELOS) to Buy from Neutral following the Q1 results to reflect the introduction of LipoLite and the company's global distribution channel. They believe shares can trade towards the $22-$26 level.
Jefferies upgraded Cellcom Israel (NYSE:CEL) to Buy from Hold following the company's Q1 results to reflect its improved EBITDA outlook.
Morgan Keegan upgraded GATX (NYSE:GMT) to Outperform from Market Perform as they believe the company has increased opportunities to deploy capital given the current state of the market for railcars, which should result in share outperformance.
Suntrust raised TNS, Inc (NYSE:TNS) to Buy from Neutral citing improved execution and the global shift towards electronic transactions.

OTHER UPGRADES:

Chevron (NYSE:CVX) was raised at UBS to Buy from Neutral.
RBC Capital upgraded TeleTech Holdings (NASDAQ:TTEC) to Sector Perform from Underperform.
Citigroup upgraded SINA Corp (NASDAQ:SINA) to Buy from Hold.

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Chevron: Lessen the impact of surging gasoline prices

Joseph Lazzaro — 2008-05-08T17:54:00+00:00

Filed under: Chevron Corp (CVX), Stocks to Buy

Readers of this space know that one of the preferred sectors has been the oil/oil services sector. Further, with oil now well above $110 per barrel, one may think that all of the affordable oil plays have been bid up. Indeed, most have, but not Chevron.

Chevron Corporation (NYSE: CVX) is the third-largest integrated oil company in the United States.

Chevron's organic reserve replacement, excluding Canadian oil sands, is sub-par, but just about every other dimension of CVX's operation rates good to strong.

Chevron's most attractive dimension? CVX has the equivalent of 'the facilities of significance' in an oil-challenged world, and especially in a gasoline-challenged United States: 22 fuel refineries, to go along with 2 asphalt plants, for a total refining capacity of 2.21 million barrels per day. Almost half of that fuel refining is based in the United States.

The significance? As noted, U.S. per capita gasoline consumption remains high -- despite record prices -- while refining capacity has not kept pace. That bodes very well for gasoline refiners, and Chevron is well-positioned to deliver the world's most sought after car fuel. The Reuters FY 2008/FY 2009 EPS consensus estimates for CVX are $10.72 to $10.60.

The risks? A breakthrough, readily-available, affordable alternative fuel, or a seismic U.S. public policy action would obviously hurt Chevron's results. But don't look for either of those realities to surface any time soon.

The First Call mean rating for CVX is: Hold [20 firms]. Mean 2008 target: $103 [high: $120, low: $55].

Stock Analysis: Chevron is moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than 2 years should be rewarded from CVX's shares. Sell/Stop Loss if you were to purchase shares in this company: $71.

Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.

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