Date: 10 March 2009
Price: $41.19
P/E: 3.42
FP/E: 6.7
P/B: 1.0
Yield: 7.8%
Debt/Eq: 0.2
Company Description
Huge oil company with a generous dividend policy. They do everything from exploration and drilling through to operating gas stations.
Note that these are the A shares, where the B shares are traded in the London Stock Exchange. This isn't anything to worry about - fundamentally by buying these shares we would be buying Shell.
Past 10 years
It all looks good. Sales, earnings, book value have all increased significantly - although it should be noted that over the past 5 years gas prices have also increased significantly... however Shell was doing well even during 2000-2005 when gas prices were fairly static.
It's interesting that P/E ratios have been consistently low these past 5 years - perhaps because gas prices have been high, and the market has been anticipating a fall.
Pros
This is all about the yield. But it's a yield in a huge multinational corporation with a solid balance sheet that prides itself on paying out a nice dividend - and indeed increased the dividend last year.
Cons
To what extent is stock price performance pegged to the price of oil? But if it is, then prices are currently far below the $130/barrel range we saw a year ago - more like $40-$50/barrel... but that's still high compared to $15-25 that we had 7 years ago.
Also, do we view big oil as 'bad' in some way - for environmental reasons for example? In which case should we not be investing?
Conclusion
Maybe. I think yes as part of a portfolio, but this would be a smaller buy compared to some of the others I think.
Showing posts with label RDS. Show all posts
Showing posts with label RDS. Show all posts
Tuesday, 10 March 2009
Saturday, 7 March 2009
7 March 2009, Dow 6627, FTSE 3530 - screening
As I start looking to invest again, I'm a little overwhelmed by the number of really cheap stocks available at this time - but also excited.
In this post I'm going to jot down a few notes on the stocks I've found - simply as a to-do list of stocks to investigate. This is based on a list I got from the MSN Deluxe stock screener (see previous post).
Screen
Roughly: FP/E < 10, Yld > 4%, Debt/Equity < 20%, P/B < 1.
I'm ignoring financial stocks for now, as these are something of a special case.
Stocks
SAY - Satyam Computer Services - Indian based consultancy.
FPE = 1, P/B = 0.28
Price has crashed in the last couple of months. A brief skim of the news suggests they're raising more money, and that there's some sort of fraud/legal investigation ongoing. May still be a bargain, but clearly there are reasons for the ridiculous price.
PDS - Precision Drilling Trust - Oil and Gas equipment
FPE = 2.3, Yield > 17%
Latest news suggests that my debt stats are incorrect, as they're trying and failing to issue debt to raise more money - perhaps to finance a recent acquisition. Again - doesn't look like a conservative pick.
ERF - Enerplus Resources - another oil and gas exploration
FPE = 3.5 (per MSN - more like 8 in reality), yield 12%
Nothing untoward here, other than typical economic woes due to falling oil and gas prices. Worth further investigation.
PAC - Pacific Airport ADR - own airports and other properties in Mexico
FPE = 6.9, P/B = 0.49. No debt.
No disasters here. Worth further investigation.
ELY - Callaway Golf Co - Makes and sells golf clubs and other accessories
FPE = 8.6. Generally cheap, but nothing spectacular.
Worth further investigation - simple business.
WES - Western Gas Partners - gas pipelines, processes and transports gas in USA.
FPE = 9. P/B = 0.5 Yield = 9.3%
Worth further investigation - has long term contracts, so may not be hit by falling gas prices particularly.
ANF - Abercrombie and Fitch - clothing retailer
Just qualified under my filter. Not particularly cheap. I don't like them because they're trendy and I'm not! :-) Maybe investigate.
RDS.A - Royal Dutch & Shell: A shares - gas again
Huge company, that I've owned (profitably) before (which is irrelevant). P/B is slightly over 1, but P/E is 6, and yield is 7.5%. Worth looking at - obviously need to figure out what the A shares are.
SNY - French pharmaceutical company
Generally cheap - FP/E of 7.
No crisis. Worth investigating.
EBF - Ennis, Inc - sells business forms, and T-shirts... ?!
Smaller than other companies. FP/E 5.4, Yield 8.3%.
Worth investigating.
For further investigation:
ERF, PAC, ELY, WES, RDS.A, EBF, SNY, ANF
In this post I'm going to jot down a few notes on the stocks I've found - simply as a to-do list of stocks to investigate. This is based on a list I got from the MSN Deluxe stock screener (see previous post).
Screen
Roughly: FP/E < 10, Yld > 4%, Debt/Equity < 20%, P/B < 1.
I'm ignoring financial stocks for now, as these are something of a special case.
Stocks
SAY - Satyam Computer Services - Indian based consultancy.
FPE = 1, P/B = 0.28
Price has crashed in the last couple of months. A brief skim of the news suggests they're raising more money, and that there's some sort of fraud/legal investigation ongoing. May still be a bargain, but clearly there are reasons for the ridiculous price.
PDS - Precision Drilling Trust - Oil and Gas equipment
FPE = 2.3, Yield > 17%
Latest news suggests that my debt stats are incorrect, as they're trying and failing to issue debt to raise more money - perhaps to finance a recent acquisition. Again - doesn't look like a conservative pick.
ERF - Enerplus Resources - another oil and gas exploration
FPE = 3.5 (per MSN - more like 8 in reality), yield 12%
Nothing untoward here, other than typical economic woes due to falling oil and gas prices. Worth further investigation.
PAC - Pacific Airport ADR - own airports and other properties in Mexico
FPE = 6.9, P/B = 0.49. No debt.
No disasters here. Worth further investigation.
ELY - Callaway Golf Co - Makes and sells golf clubs and other accessories
FPE = 8.6. Generally cheap, but nothing spectacular.
Worth further investigation - simple business.
WES - Western Gas Partners - gas pipelines, processes and transports gas in USA.
FPE = 9. P/B = 0.5 Yield = 9.3%
Worth further investigation - has long term contracts, so may not be hit by falling gas prices particularly.
ANF - Abercrombie and Fitch - clothing retailer
Just qualified under my filter. Not particularly cheap. I don't like them because they're trendy and I'm not! :-) Maybe investigate.
RDS.A - Royal Dutch & Shell: A shares - gas again
Huge company, that I've owned (profitably) before (which is irrelevant). P/B is slightly over 1, but P/E is 6, and yield is 7.5%. Worth looking at - obviously need to figure out what the A shares are.
SNY - French pharmaceutical company
Generally cheap - FP/E of 7.
No crisis. Worth investigating.
EBF - Ennis, Inc - sells business forms, and T-shirts... ?!
Smaller than other companies. FP/E 5.4, Yield 8.3%.
Worth investigating.
For further investigation:
ERF, PAC, ELY, WES, RDS.A, EBF, SNY, ANF
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