Category: Articles

Christmas in July……..Unique

Post author By ToddSullivan
Post date July 15, 2009

So Sears Holdings (SHLD) and Eddie Lampert are trying something else unique.

Time Reports:

Sears Holding Corp., which runs both the Sears and Kmart department stores, is running a Christmas promotion a full five months before Saint Nick leaves the North Pole with his reindeer. On both the sears.com and kmart.com homepages, customers are invited to “Shop Christmas Lane,” and are directed to deals on holiday ornaments, stocking stuffers and other winter-related merchandise. The Christmas goods will also be on display in 372 Sears stores throughout the country; the promotion runs through July 25.

With temperatures simmering and families spending summer days at the shore, most customers aren’t exactly in the Christmas spirit. So what convinced Sears, which has seen nothing but annual same-store sales declines at both its namesake and Kmart stores over the past four years, that skeptical shoppers want to open up their wallets for Christmas gifts now? “After the last holiday season, customers told us that they wish they had seen some of our merchandise earlier,” says Natalie Norris-Howser, a Sears spokeswoman. “People are buying earlier today. Also, customers have grown accustomed to the Christmas-in-July terminology, so we wanted to leverage that.” Norris-Howser also pointed to the company’s generous layaway offers for bigger-ticket items as an incentive for shoppers to do their holiday buying today.

In today’s environment, any move that attracts attention might be worth it. “Overall, it seems to be a pretty smart strategy,” says Pete Blackshaw, a brand strategist for Nielsen Online. “Doing it on the Web makes a world of sense. They are clearly getting some buzz, there’s a novelty effect. At a time when everybody is going to be competing around November to get attention, this is a good opportunity to potentially get in front of the line.” Blackshaw, who monitors how brands are perceived in the social-networking sphere, says the Christmas marketing has gotten positive feedback on Twitter.

The first reaction I had was…..WTF? But after think it through for a bit, I then thought, why not? Christmas is always a shopping must for folks, why not provide them easy access to its specific items well before the event? Every year retailers begin the holiday shopping season earlier and earlier, Sears just got the jump this year.

Put it this way, what does Sears have to lose? Nothing. Here what the move also does, it gives Sears a unique place in the mind of consumers. It goes to “top of mind” awareness. What Sears is doing is pounding away the message “Sears=Christmas”. After consumers hear it enough, when it comes time to do the shopping for the big day, they then are more likely to visit Sears either in the stores OR online.

Given what Sears has done with its website, drawing people to it is sure to increase sales via that channel.

This is keeping with Lampert’s strategy. It is a cost effective way to differentiate Sears from the rest of the retail pack. If it flops, there is little lost and if it is a hit (like last year’s early entry into layaway) the upside is huge.

The easiest way to judge it success since Sears does not talk much to the press is to watch Wal-Mart (WMT) and Target (TGT). If they begin copy cat programs, it will only be because they see Sears having success with it.

Disclosure (“none” means no position):Long SHLD

Tags SHLD

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Value Investing Congress Speaker Update

Post author By ToddSullivan
Post date July 15, 2009
3 Comments on Value Investing Congress Speaker Update

For my money, this is the premier value investor event. Yeah, I know Berkshire (BRK.A) and Buffett have the “Woodstock for Capitalists” every year but let’s be really honest, by the time it is held, Buffett has been on TV 50,000 times that year and there isn’t really anything he says there that is “new”. Yes it is a great event (have been before) but as far as an event that provides actionable ideas in the value setting, it just isn’t it.

The Value Investing Congress in just that event.

Here is the current speaker lineup…

For the record, other than attending the conference and being a huge fan of it, I have no affiliation with it at all.

I plan on attending again this year and blogging/twittering about it live….

With any luck I’ll nab an interview with one of the more prominent speakers….. hint,hint out there…

Disclosure (“none” means no position):

Tags buffett, VIC

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Dow Ag Makes Acquisition

Post author By ToddSullivan
Post date July 15, 2009

Dow Ag (DOW) is not acting like a company that is up for sale…

The Indianapolis Business Journal Reports:

Dow Agrosciences LLC said today it is acquiring the majority of assets of Illinois-based seed corn company Pfister Hybrids.

A sale price was not disclosed.

Under the terms of the agreement, Indianapolis-based Dow AgroSciences, a subsidiary of Dow Chemical Co. in Michigan, will acquire the Pfister brand and the sales and marketing areas, as well as the warehousing and administrative services. The Pfister brand will continue, and the company still will be headquartered in El Paso, Ill.

Pfister President Linda Brown will assume the title of general manager.

The addition of Pfister Hybrids will further expand Dow AgroSciences’ current seeds business in the United States as it anticipates introducing insect protection and weed control, and herbicide tolerance, technology within the next few years, the company said in a written statement.

“At Dow AgroSciences investing in innovation is the key to our future, and we look forward to building upon the Pfister tradition,” said Stan Howell, vice president, North America regional commercial unit for Dow AgroSciences.

Dow AgroSciences has global sales of $4.5 billion.

Pfister Hybrids was founded in 1936.

I’ve been adamantly opposed to a Dow Ag sale since it was first broached back in May. Since then Dow has risen funds through alternative channels and seems to be backing off the outright sale talk. These are all very good development.

So, what would be acceptable? A partial IPO of Dow Ag would do should it be absolutely necessary. What would be even better would be if they offered it to current shareholders first then sold any excess to the public (there would not be any).

Anyway, not often do we see a company about to be sold making acquisitions. That is the good news. It says to me that the “sale” of Dow Ag is becoming a more remote possibility as each days passes….

Disclosure (“none” means no position):Long Dow

Tags dow

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Wednesday's Links

Post author By ToddSullivan
Post date July 15, 2009

Romney, McDonalds, Netflix, Adam

– The Onion does it again….

Mitt Romney Defends Himself Against Allegations Of Tolerance

– Wasn’t there a rap song … “this is how we do it…”

– I love Netflix and an Amazon/Netflix combo is a perfect match. That being said, Adam is always on top of anything options

– Adam on the SPY

Disclosure (“none” means no position):

Tags mcd

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Wednesday’s Links

Post author By ToddSullivan
Post date July 15, 2009

Romney, McDonalds, Netflix, Adam

– The Onion does it again….

Mitt Romney Defends Himself Against Allegations Of Tolerance

– Wasn’t there a rap song … “this is how we do it…”

– I love Netflix and an Amazon/Netflix combo is a perfect match. That being said, Adam is always on top of anything options

– Adam on the SPY

Disclosure (“none” means no position):

Tags mcd

Articles

Global Recession Chatter Falls & Spending Gains

Post author By ToddSullivan
Post date July 14, 2009
1 Comment on Global Recession Chatter Falls & Spending Gains

Good news? Some very large populated countries are seeing strong spending growth. Bad news? It isn’t the US and Canada

From the recent Current:

James Russo, Vice President, Global Consumer Insights for The Nielsen Company says: “While discussions about the recovery are still quite low, we have seen that the public is talking less about the recession — often dramatically less.”

“Of the countries we examined, Spain had the closest margin between discussions of the recession and recovery. In other words, there were only 26 percent more chats about the recession than the recovery”

“In the U.S., we found that recession discussions have dropped since hitting a peak in January. There appears to be a strong correlation between what consumers are saying in discussion groups and their subsequent actual purchase behavior.

“From the end of 2008 to March 2009, when recession discussions were highest, we found that sales actually declined by 2.3 percent. From mid-March to early June, as recession chats dropped, we found that sales actually showed a modest increase”

In all countries measured this month, consumers are saving more of their money – even Americans, who have had a low savings rate, are holding onto their cash as concerns about unemployment and financial security continue.

Additional highlights from this month’s NEC:

· U.S. consumers pulled back on shopping and how much they spent per trip. Meanwhile, the shift to value channels such as supercenters, club and dollar stores continued, as did the move to private label store brands.
· Spending increased in Brazil and England
· Spending declined in U.S. and Canada
· China, France, Germany, India, Italy and Spain showed no movement from the previous month.

There were two chart that spoke volumes (click both charts to enlarge):

On a global scale in almost every country the “chatter” for lack of a better word on recession seems to have had a rather large fall. What is not accompanying that is “recovery” talk. That leads us to chart two:

What is happening globally is that as the recession talks wanes, a cautious consumer is resuming spending in certain areas. This does give some credence for those who want the “unprescedented economic recession” talk from government officials squashed a bit. I understand being honest with the voters, BUT, I am not sure it is necessary to tell us hourly how if we do not “act now”, catastrophe is sure to follow. We get it, lighten up.

No, I am not blaming those who are using such talk for the recession but what I am saying is that those actions do not help the mood of the consumer. It causes them to act very rational, they just do not spend.

One interesting point here is the strength from China, India and Brazil. What is the possible investment for their growth assuming one does not want to invest in individual names on those markets (I don’t).

For those looking to invest in commodities like oil (USO), with US supplies falling, one should assume the growth in those nations will begin to extract any excess global supply of oil from the market, putting a bid under current prices.

Here are a couple videos that underscore the point.

Well, can’t we just produce more? Not really. Let’s look at rig counts (from Baker Hughes (BHI) as of July 9):

US Rig Count is down 12 from last week at 916; down 1,006 year over year. Canadian count is up 13 from last week at 178; down 236 year over year. US Offshore count is 37, down 5 from last week; down 30 year over year. Worldwide count for June 2009 was 1,987, up 4 from the 1,983 counted in May 2009 and down 1,282 from the 3,269 counted in June 2008.

Simply put, demand for oil will well outstrip supply for it when the worm turns. As demand falls these rigs are slowly removed from service. There is a considerable lag that occurs when demand resumes before they are put back into service as producers want to be sure the demand is real and not a short term aberration. If you believe a 2nd half recovery is in store for the US (or at least stabilization) then oil prices would seem to have no place to go but up. We have already seen US supply levels falling as production has been taken off and the economy’s slide has lessened. Any uptick in activity ought to cause a nice spike in oil (for investors).

Disclosure (“none” means no position):none

Articles

Wisconsin Supreme Court Rules for Defendants

Post author By ToddSullivan
Post date July 14, 2009

A win for the paint industry in the latest consumer product litigation scam.

Jane Genova reports:

Today, MEALEY’S LITIGATION REPORT issued a special e-mail bulletin on the long-awaited Wisconsin Supreme Court ruling in “Ruben Baez Godoy v. E.I. duPont de Nemours and Co., (DD) et al.”

MEALEY’S editor James Cordrey reports, “The Wisconsin Supreme Court today unanimously affirmed an appellate court ruling and held that lead pigment is not defectively designed, dismissing a lead-poisoned boy’s claims for strict liability and negligence against the former manufacturers of white lead carbonate pigment.” The appellate court had affirmed the circuit court’s ruling.

As the defendants have kept declaring in this litigation, the Court agreed that “the Circuit Court correctly concluded that the complaint failed to state claims for defective design. A claim for defective design cannot be maintained here where the presence of lead is the alleged defect in design and its very presence is a characteristic of the product itself.”

Cordrey points out that WI SC also said that even though the feasibility of an alternative design can be considered when evaluating a design defect claim, it isn’t a requirement. He goes on to explain that when the ingredient can’t be designed out of the product, the Court noted that the Restatement [Second] of Torts instructs that although other claims may be asserted, the proper claim is not design defect.
Cordrey will expand on this analysis in the July edition of MEALEY’S LITIGATION REPORT: LEAD. Meanwhile copies of this and all other litigation documents are available for a fee from MEALEY’S.

I had for a while held Sherwin Williams (SHW) shares and was encouraged when they were finally victorious in the Rhode Island litigation. But as housing continued its decline and the legal environment in other locals became more questionable, I sold my shares. Shares have held up very well considering the potential litigation risk (think asbestos). My assumption is that investors agree that the litigation on its face is a farce BUT, that does not mean that plaintiffs can’t win one here and there. Any win of any significance could lead to a cascade of private suits.

As State’s suffer extreme budget shortfalls, I would not be surprised if more suits are filed in a “lottery mentality”. AG’s have nothing to lose and everything to gain especially if they can force settlements. To this point paint makers have resisted and fought tooth and nail very successfully for the most part case by case.

Sherwin is clearly the class of the group from just an operational perspective. It is a great company with great management. The current legal environment for it, and others (think Altria) seems to be turning and not in a good way.

Other public companies usually involved in the suits would be NL Industries (NL) and DuPont (DD).

Disclosure (“none” means no position):None

Tags MO

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Wells Fargo’s Interesting NPL Deal

Post author By ToddSullivan
Post date July 14, 2009

$.35 cents on the dollar it seems would be the price for these loans….

From National Mortgage News:

As the mortgage and banking industries debate whether the PPIP program will work and whether a similar effort over at the FDIC will ever see the light of day, Wells Fargo & Co. recently (and quietly) sold a $600 million portfolio of mostly non-performing subprime loans. Or so we’re told.

Late last week a source close to the transaction identified Arch Bay Capital of Irvine, Calif., as the winning bidder on the portfolio whose loans were originally funded by two mid-sized subprime wholesalers: Accredited Home Loans, and NovaStar Financial.

Arch Bay co-founder Steven Davis declined to comment on the purported sale to his firm, referring calls to his partner Shawn Miller who serves as Arch Bay’s CEO. Mr. Davis didn’t deny that the sale took place but he wouldn’t confirm it either. Mr. Miller could not be reached for comment.

Meanwhile, one question the sale raises is this: How exactly did the publicly traded Wells wind up with so many crummy non-prime loans from these once highflying firms? Answer: I don’t know and Wells isn’t talking. A company spokesman said the bank’s corporate policy is to not discuss its loan auctions.

Perhaps one reason the PPIP (Public-Private Investment Program) and the Federal Deposit Insurance Corp.’s ‘Legacy Loan’ sale initiative (involving whole loans, presumably residential and commercial mortgages) hasn’t caught fire is ‘sunshine,’ that is, the concept of disclosure. If bankers and investment bankers use these government programs that means all the messy details of their crappy investments might see the light of day, which could anger shareholders — and maybe even board members who might lean toward being “activists.”

The nice thing about the private non-performing loan market is that none of these messy details have to see the light of day, including the price paid. One banker told me that the 35 cents on the dollar that Arch Bay reportedly paid was twice what some hedge fund bidders were offering.

No matter how you do the math, Wells is going to take a nice hit on the sale, if it hasn’t done so already. Will the public ever get wind of the NPL sale price (outside this story)? That’s hard to say. The Securities and Exchange Commission requires that publicly traded companies disclose “material events” in their 10-Qs and Ks but when you have a mega bank the likes of Wells a $600 million loan auction might garner a sentence in the next earnings report, at best.

It is another reason to assume the PIPP program is not needed nor will it take off if private market deals are being worked out UNDER the radar rather than being exposed for all to see. I am guessing the banks do not want these prices exposed.

It also does bode well for the secondary markets if the log jam is starting to loosen and deals are getting done, albeit at a trickle. Any deal that gets done w/o the gov’t “help” is a real positive for everything.

Hopefully more of these deals will start happening….

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Disclosure (“none” means no position):Long WFC

Tags wfc

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Wells Fargo's Interesting NPL Deal

Post author By ToddSullivan
Post date July 14, 2009

$.35 cents on the dollar it seems would be the price for these loans….

From National Mortgage News:

As the mortgage and banking industries debate whether the PPIP program will work and whether a similar effort over at the FDIC will ever see the light of day, Wells Fargo & Co. recently (and quietly) sold a $600 million portfolio of mostly non-performing subprime loans. Or so we’re told.

Late last week a source close to the transaction identified Arch Bay Capital of Irvine, Calif., as the winning bidder on the portfolio whose loans were originally funded by two mid-sized subprime wholesalers: Accredited Home Loans, and NovaStar Financial.

Arch Bay co-founder Steven Davis declined to comment on the purported sale to his firm, referring calls to his partner Shawn Miller who serves as Arch Bay’s CEO. Mr. Davis didn’t deny that the sale took place but he wouldn’t confirm it either. Mr. Miller could not be reached for comment.

Meanwhile, one question the sale raises is this: How exactly did the publicly traded Wells wind up with so many crummy non-prime loans from these once highflying firms? Answer: I don’t know and Wells isn’t talking. A company spokesman said the bank’s corporate policy is to not discuss its loan auctions.

Perhaps one reason the PPIP (Public-Private Investment Program) and the Federal Deposit Insurance Corp.’s ‘Legacy Loan’ sale initiative (involving whole loans, presumably residential and commercial mortgages) hasn’t caught fire is ‘sunshine,’ that is, the concept of disclosure. If bankers and investment bankers use these government programs that means all the messy details of their crappy investments might see the light of day, which could anger shareholders — and maybe even board members who might lean toward being “activists.”

The nice thing about the private non-performing loan market is that none of these messy details have to see the light of day, including the price paid. One banker told me that the 35 cents on the dollar that Arch Bay reportedly paid was twice what some hedge fund bidders were offering.

No matter how you do the math, Wells is going to take a nice hit on the sale, if it hasn’t done so already. Will the public ever get wind of the NPL sale price (outside this story)? That’s hard to say. The Securities and Exchange Commission requires that publicly traded companies disclose “material events” in their 10-Qs and Ks but when you have a mega bank the likes of Wells a $600 million loan auction might garner a sentence in the next earnings report, at best.

Hopefully more of these deals will start happening….

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Disclosure (“none” means no position):Long WFC

Tags wfc

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Tuesday’s Links

Post author By ToddSullivan
Post date July 14, 2009

A lesson, Fail, CRE, Depression

– N.Carolina provides us with a perfect example of how tax policy will drive business to other locals

– More on CNBC

– Distressed Volatility on CRE

– Are we repeating the mistakes of Hoover and FDR?

Disclosure (“none” means no position):

Articles

Tuesday's Links

Post author By ToddSullivan
Post date July 14, 2009

A lesson, Fail, CRE, Depression

– N.Carolina provides us with a perfect example of how tax policy will drive business to other locals

– More on CNBC

– Distressed Volatility on CRE

– Are we repeating the mistakes of Hoover and FDR?

Disclosure (“none” means no position):

Articles

Phillip Morris International Makes Another Acquisition

Post author By ToddSullivan
Post date July 13, 2009
6 Comments on Phillip Morris International Makes Another Acquisition

A global giant, Phillip Morris International (PM) grows larger…

New York, July 10, 2009 – Philip Morris International Inc. [NYSE/Euronext Paris: PM] (PMI) announced today that it has entered into an agreement to purchase 100% of the shares of privately owned Colombian cigarette manufacturer, Productora Tabacalera de Colombia, Protabaco Ltda. (Protabaco), for $452 million.

Protabaco is the second largest tobacco company in Colombia, with an estimated 2008 volume of 6.1 billion cigarettes and an approximate market share of 31.8%. The Company reported net revenues of approximately $107.6 million in 2008. Its leading brands include Mustang, Premier and President.

“We are extremely pleased to reach this agreement with Protabaco in order to continue to build our business in this important and strategic market,” said Miroslaw Zielinski, President of PMI’s Latin America and Canada Region. “This strategically compelling transaction will provide PMI with an excellent opportunity to further develop Protabaco’s strong brand portfolio and reflects the continuing confidence we have in the future of Colombia, its economy and the tobacco industry.”

In 2005, PMI acquired Compañía Colombiana de Tabaco S.A. (Coltabaco). Since then, PMI has continued to invest in Coltabaco, its employees and its infrastructure, as well as in social and economic programs in Colombia, including investments in the tobacco growing sector.

“This is an excellent development for Protabaco and our employees,” said Jaime Delgado, General Manager Protabaco. “PMI is well known as a successful manufacturer and marketer of quality tobacco products and we believe they are in an excellent position to continue to develop our strong brands and strong organization.”

The transaction, which is subject to competition authority approval and final confirmatory due diligence, is projected to be immediately marginally accretive to PMI’s earnings per share and is expected to close within the next six months.

SEC Filing

This is one of the very few investments I am comfortable buying and holding for a VERY LONG time….many years.

Aside from the stunning fundamentals of the tobacco business, there is the currency play here.

The potential for growth in this business is vast, the business has a great fundamentals (they make a legal product for pennies they sell to addicts for dollars) and most importantly, they have a dominant market position in almost every market they play in. Oh, did I mention the almost 5% dividend yield?

What are the risks to it? A massive global effort to ban cigarettes. Is it likely? No. Why? Tax revenue… If the US can’t ban them because they are enslaved to their tax revenues (and Master Settlement payments) then they wont be banned anywhere else. When you add in the scenario in which many cigarette companies are in fact quasi-state run institutions and Phillip Morris has actually partnered with them, the “banning” question becomes even more remote…

So you have a business that is global, without the US litigation risks, a 5% dividend yield, vast/growing markets and a product people who use it will not do without…

It is a great business…

Disclosure (“none” means no position):Long PM

Tags PM

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Ruffano Joins General Growth’s Board

Post author By ToddSullivan
Post date July 13, 2009
1 Comment on Ruffano Joins General Growth’s Board

This is interesting…

CHICAGO–(BUSINESS WIRE)–GENERAL GROWTH PROPERTIES, INC. (GGWPQ) today announced the appointment of Glenn J. Rufrano to its Board of Directors.

Mr. Rufrano is currently the chief executive officer of Centro Properties Group, a retail investment organization specializing in the ownership, management, and development of retail shopping centers with an extensive portfolio of centers across Australia, New Zealand and the United States, which does not compete directly with GGP. Mr. Rufrano led Centro Properties Group through its successful restructuring during the current credit crisis. From 2000 until its acquisition by Centro Properties Group in April 2007, Mr. Rufrano was chief executive officer of New Plan Excel Realty Trust, Inc., as well as a member of that company’s board of directors. Mr. Rufrano spent 17 years as a partner at The O’Connor Group, a diversified real estate firm.

“Glenn’s CEO and restructuring experience combined with his regional shopping mall expertise will be invaluable to the Company as we continue to develop the plan to emerge from bankruptcy. We are delighted to be able to strengthen our Board with this latest addition and look forward to benefiting from his insights and experience,” said Adam Metz, chief executive officer of General Growth Properties.

So, why is this interesting?

Here is Mr. Ruffano’s most recent work:
Centro Completes Debt Stabilisation Agreement

Notice one constant theme? Maturity extension…..the very same thing GGP is looking to do.

It is important to note here that Centro’s action were done outside of the bankruptcy court and, being and Australian company, bankruptcy law there is different than here. The central point remains though that Ruffino does have successful real world experience in the current market environment. That is good as this progresses..

On another note, Robert Jaffe’s (formerly of SAC capital) Force Capital picked up 1.1 million General Growh shares in the most recent quarter according to this SEC filing

Disclosure (“none” means no position):Long GGWPQ

Tags ggp

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Ruffano Joins General Growth's Board

Post author By ToddSullivan
Post date July 13, 2009
1 Comment on Ruffano Joins General Growth's Board

This is interesting…

CHICAGO–(BUSINESS WIRE)–GENERAL GROWTH PROPERTIES, INC. (GGWPQ) today announced the appointment of Glenn J. Rufrano to its Board of Directors.

Mr. Rufrano is currently the chief executive officer of Centro Properties Group, a retail investment organization specializing in the ownership, management, and development of retail shopping centers with an extensive portfolio of centers across Australia, New Zealand and the United States, which does not compete directly with GGP. Mr. Rufrano led Centro Properties Group through its successful restructuring during the current credit crisis. From 2000 until its acquisition by Centro Properties Group in April 2007, Mr. Rufrano was chief executive officer of New Plan Excel Realty Trust, Inc., as well as a member of that company’s board of directors. Mr. Rufrano spent 17 years as a partner at The O’Connor Group, a diversified real estate firm.

“Glenn’s CEO and restructuring experience combined with his regional shopping mall expertise will be invaluable to the Company as we continue to develop the plan to emerge from bankruptcy. We are delighted to be able to strengthen our Board with this latest addition and look forward to benefiting from his insights and experience,” said Adam Metz, chief executive officer of General Growth Properties.

So, why is this interesting?

Here is Mr. Ruffano’s most recent work:
Centro Completes Debt Stabilisation Agreement

Notice one constant theme? Maturity extension…..the very same thing GGP is looking to do.

On another note, Robert Jaffe’s (formerly of SAC capital) Force Capital picked up 1.1 million General Growh shares in the most recent quarter according to this SEC filing

Disclosure (“none” means no position):Long GGWPQ

Tags ggp

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Exxon as A Proxy?

“Davidson” submits

I do some individual work for domestic portfolios. My basis is first to identify good management cultures, then I analyze to understand the business dynamics and lastly I establish a valuation basis. Exxon (XOM) is an issue that meets the management culture criteria and today’s price of ~$65shr speaks volumes. By itself XOM could be a good addition to any conservative portfolio at the current level. But, more than that XOM can also be used as proxy for the oil sector and today’s level helps me to make decisions to buy any energy based company that has pulled back in the current environment.

XOM is particularly helpful as there is not a specific energy stock index that goes back as far as XOM’s history.

In the few accounts I manage, I am buying selected energy stocks.

Chart from 1964-Present (click to enlarge)

My two cents:

Exxon currently yields 2.6% and is trading 30% off its 2007-08 high on over $90 a share. Skeptics will point to the current administration and its less than friendly view of oil companies and impending taxation plans.

For some perspective we need only go back to the Clinton years to find a similar energy policy. During those years Exxon shares rose from $11 to $40. Not bad appreciation, excluding dividends… For those not wanting to do the math, that is 17.5% annual return (dividends excluded).

Disclosure (“none” means no position):none

Tags davidson, uso, xom