ExxonMobil (NYSE: XOM) is a $300 billion company trading at nearly 12 times earnings. Has this super major oil company reached a peak valuation — or should these shares be an immediate addition to your portfolio? My take: ExxonMobil is a buy. I have five reasons for it. 1. Easy oil is gone. In the early days of the oil business, oil lurked, somewhat reliably, in certain geological formations. Wildcatters sought to capitalize on this untapped wealth. And while the… Read More

ExxonMobil (NYSE: XOM) is a $300 billion company trading at nearly 12 times earnings. Has this super major oil company reached a peak valuation — or should these shares be an immediate addition to your portfolio? My take: ExxonMobil is a buy. I have five reasons for it. 1. Easy oil is gone. In the early days of the oil business, oil lurked, somewhat reliably, in certain geological formations. Wildcatters sought to capitalize on this untapped wealth. And while the oil business was never really “easy,” it seemed like there was an unlimited supply. But that was not the case, and as many of the United States’ largest fields have been tapped. Finding major new fields is becoming harder and harder. Most onshore oil reserves are government-controlled. That’s great news for Exxon. As a capable cost manager and with a reputation for delivering results on time, it’s the go-to oil company to help nations develop their petroleum reserves. In the next two years alone, Exxon will start major projects in Qatar, Canada, Russia and throughout Africa, with… Read More

I’ve never been an alarmist. I spend far more time talking about promising investment opportunities than spouting financial doom and gloom. But there’s a real debt crisis brewing in the United States, and turning a blind eye to the problem won’t make it go away. An endless… Read More

The oil spill disaster in the Gulf of Mexico will alter the landscape for offshore drilling for decades to come. Uncertainty over new regulations, lawsuits and the near-term hit to business in the region have sent the share prices of many major players in the industry to multi-year lows. But at current valuations, shares of these major players are pricing in extremely negative outcomes and don’t take into consideration that Gulf drilling is a small and declining percentage of global activity. As a result, I’ve found one major industry player that… Read More

The oil spill disaster in the Gulf of Mexico will alter the landscape for offshore drilling for decades to come. Uncertainty over new regulations, lawsuits and the near-term hit to business in the region have sent the share prices of many major players in the industry to multi-year lows. But at current valuations, shares of these major players are pricing in extremely negative outcomes and don’t take into consideration that Gulf drilling is a small and declining percentage of global activity. As a result, I’ve found one major industry player that qualifies as “The Bargain Stock of the Year.” After several months of high-level drama and extreme uncertainty, the oil spill in the Gulf appears to finally be under control. BP plc (NYSE: BP) is in the midst of completing its “static kill” cap that should stem the leak from the Macondo well permanently. In addition to the devastation the disaster has brought to the Gulf region, share prices of BP and its partners in the well, which include Anadarko Petroleum (NYSE: APC) and Mitsui, which owned about 25% and 10% of the well, respectively,… Read More

My mother’s side of the family owns large tracts of land along the Louisiana and Mississippi border. The area is teeming with wildlife and has been an outdoor paradise for at least five generations. But the real value of this fertile region is the soil itself, where… Read More

U.S. debt is skyrocketing with no end in sight. And while the dollar has recently functioned as a short-term safe haven, its long-term fundamentals are deteriorating. #-ad_banner-#To put it in perspective, U.S. public debt in 2000 was $3.4 trillion. That has now more than doubled to $8.6… Read More

If the BP (NYSE: BP) saga is a tale of three acts, Act One will soon be complete. The company’s leaking well is almost capped, new management is in place and a plan is emerging that will help cover recent costs and make sure the balance sheet doesn’t collapse. Act Two, which will play out during the next 18 months, will involve implementing the turnaround plan. And Act Three, which we’ll likely see in 2012, will be a new, smaller, post-crisis BP that is once… Read More

If the BP (NYSE: BP) saga is a tale of three acts, Act One will soon be complete. The company’s leaking well is almost capped, new management is in place and a plan is emerging that will help cover recent costs and make sure the balance sheet doesn’t collapse. Act Two, which will play out during the next 18 months, will involve implementing the turnaround plan. And Act Three, which we’ll likely see in 2012, will be a new, smaller, post-crisis BP that is once again valued on future profits and not simply a rough guess of assets and liabilities. BP’s debt/cash flow balancing act On its second-quarter conference call, BP management laid out plans to cover the spill’s costs by taking out a $32 billion charge. In our initial assessment back in early June, we assumed that costs would be less, in the $10 to $20 billion range. After our initial analysis, shares fell even further as concerns grew that liabilities would break the company. Shares have recently rallied to… Read More

There are dozens of very large ships plying the global waters that do nothing but ferry dry goods. Think of coal, grain, steel and other such bulk goods. When major nations actively trade these goods, bulk ships are in hot demand and the cost to lease them can surge. But… Read More

Shares of copper and gold miner Freeport McMoran (NYSE: FCX) are trading off of their early highs, but still up a respectable +4%, thanks to surprisingly strong second-quarter profits. Quarterly results for this mining giant are based on two simple… Read More

Love is a fickle thing. When oil prices surged past $100 a barrel in 2008, investors fell madly in love with alternative energy stocks. But when oil prices crashed, and when signs emerged that government budget problems would curtail the industry-friendly subsidies, so did investor ardor for this young industry. Read More

Aubrey McClendon is certainly audacious. The co-founder, chairman and chief executive officer of Chesapeake Energy (NYSE: CHK) always swings for the fences. Trouble is, he has swung and missed more often than not. But hope springs eternal, and he’s taking big swings once again. And that’s why McClendon and Chesapeake Energy are either loved or hated, depending on who you talk to. There’s Gas in Them Thar Shales After seeing the natural gas market soar and fall throughout much of the last two decades, McClendon started to see a perfect storm brewing a few… Read More

Aubrey McClendon is certainly audacious. The co-founder, chairman and chief executive officer of Chesapeake Energy (NYSE: CHK) always swings for the fences. Trouble is, he has swung and missed more often than not. But hope springs eternal, and he’s taking big swings once again. And that’s why McClendon and Chesapeake Energy are either loved or hated, depending on who you talk to. There’s Gas in Them Thar Shales After seeing the natural gas market soar and fall throughout much of the last two decades, McClendon started to see a perfect storm brewing a few years ago, one that temporarily made him a billionaire. In 2008, natural gas prices were soaring and geologists were starting to see that the United States was sitting on the “Saudi Arabia of natural gas” under deep rock formations known as shales. With more and more power plants expected to switch from coal to natural gas during the next decade, and a seemingly unlimited bounty of gas underground, Chesapeake borrowed millions in order to buy up and exploit vast untapped gas fields. And McClendon had no trouble finding fans on Wall Street. Read More