T. Boone Pickens Is Buying These Stocks Right Now ($BP $CHK $DVN $DWSN $ECA $NOV $RIG $SD $WFT)
Oil may have sold off hard recently, but billionaire investor T. Boone Pickens still loves energy stocks. After all, he made his fortune by investing in energy, so he knows a thing or two about picking winners among the oil, natural gas and power producers. Recently, BP Capital released its holdings as of March 31, 2012 in a 13F filing. Let’s take a closer look at some of its most bullish bets.
Top 10 Holdings:
| Company | Ticker | Value ($000s) | Activity |
| BP PLC | BP | 20,345 | 12% |
| ENCANA CORP | ECA | 18,392 | New |
| NATIONAL OILWELL VARCO INC | NOV | 14,262 | 0% |
| DEVON ENERGY CORP NEW | DVN | 13,513 | 36% |
| TRANSOCEAN LTD | RIG | 13,068 | 47% |
| CHESAPEAKE ENERGY CORP | CHK | 11,563 | -12% |
| WEATHERFORD INTL LTD NEW | WFT | 10,489 | 35% |
| SANDRIDGE ENERGY INC | SD | 9,250 | 0% |
| DAWSON GEOPHYSICAL CO | DWSN | 8,426 | 0% |
| SUNCOR ENERGY INC NEW | SU | 7,063 | 0% |
Encana Corp (ECA) is a new position in BP’s portfolio – the fund did not report owning any shares of Encana at the end of 2011 – but it is one of its largest holdings. During the first quarter of 2012, BP initiated a new position in the company worth $18 million. A few other hedge funds also have Encana in their 13F portfolios. At the end of last year, there were 19 hedge funds reported to own this stock. Steven Cohen’s SAC Capital Advisors had nearly $100 million invested in Encana (check out Steven Cohen’s top stock picks) at the end of last year. Martin Whitman and Ken Griffin are also bullish about this stock. See chart below.
Pickens likes Devon Energy Corp (DVN) as well. The stock is the fourth largest position in his latest 13F portfolio. Pickens boosted his stakes in Devon by 36% over the first quarter to $190 million. Devon is also quite popular amongst the other hedge funds we track. There were 32 hedge funds with positions in Devon at the end of last year. Devon has also shifted its focus from natural gas to oil and natural gas liquids. We think Devon is well positioned to benefit from the higher margins of liquids. See chart below.
Of course, just because BP Capital is natgas and alternative energy-heavy doesn’t mean that Boone Pickens’ fund is eschewing traditional oil firms. His fund picked up 188,000 shares of Valero Energy (VLO_) last quarter, building up a $5 million stake in the country’s largest independent oil refiner. Valero has the capacity to process more than 2.8 million barrels of crude per day through its 14 refineries, in addition to a massive ethanol business and a 1,000-unit gas station business. See Chart below.
Pickens stuck to his strong suit in energy with new picks Encana (ECA), Calpine (CPN), Exelon (EXC), Valero (VLO), and NRG Energy (NRG). He also added to BP Plc (NYSE:BP), Devon Energy (NYSE: DVN), Transocean, and Weatherford International LTD.
Other large positions in Pickens’ portfolio are BP Plc (BP), National Oilwell Varco Inc (NOV), and Transocean Ltd (RIG). Pickens did not increase or decrease his stakes in National Oilwell. He increased his BP position by 12% and his Transocean position by 47% over the first quarter. All of these stocks have attractive valuation levels, especially BP. It is currently trading at only 5.6x its 2013 earnings and has a dividend yield of 5.12%.
BP is the most popular oil company among hedge funds, followed by Exxon Mobil. Value investorSeth Klarman had a $400+ million position in the stock at the end of the first quarter. Billionaires Ken Fisher and Ken Griffin are among the fund managers with large XOM positions. They both boosted their stakes in XOM during the first quarter (see Ken Fisher’s top stock picks). See chart below.
Sources:
http://beta.fool.com/insidermonkey/2012/06/13/billionaire-t-boone-pickens-top-stocks/5647/
http://seekingalpha.com/article/602461-billionaire-t-boone-pickens-q1-stock-picks
http://www.thestreet.com/story/11579293/6/5-energy-stocks-t-boone-pickens-loves-right-now.html
Photo credit: http://gigaom.com/cleantech/video-t-boone-pickens-on-the-new-natural-gas-vehicle-act/
This is not an offer to buy or sell securities. Oil investment carries with it very high risks. The information contained within this site has not been nor will it be verified by Turn Key Oil and is subject to change at any time. We are not a United States Securities Dealer or Broker or United States Investment Adviser. Do your own due diligence and consult with a licensed professional before making any investment decisions. Please read our full disclaimer before making any decisions.
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Transocean Ltd. Provides Fleet Status Report
Jul 18, 2012 3:15:00 PM
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ZUG, SWITZERLAND — (Marketwire) — 07/18/12 — Transocean Ltd. (NYSE: RIG) (SIX: RIGN) today issued a comprehensive Fleet Status Report which provides current status and contract information for the company’s entire fleet of offshore drilling rigs. Since the June update, backlog associated with new contracts or extensions is approximately $1.5 billion and 2012 estimated out of service time increased by a net 16 days.
Highlights are as follows:
Discoverer Deep Seas – Awarded a three-year contract for work in the U.S. Gulf of Mexico at a dayrate of $595,000 ($652 million contract backlog). The rig’s prior contract dayrate was $450,000.
GSF Arctic III – Awarded a 17-well contract for work in the U.K. sector of the North Sea at a dayrate of $313,000 ($205 million contract backlog), consistent with the rig’s recently-signed, three-month prior contract.
GSF Jack Ryan – Customer exercised a one-year option for work offshore Nigeria at a dayrate of $425,000 ($155 million contract backlog).
Transocean Marianas – Awarded a 280-day contract for work offshore Namibia at a dayrate of $530,000 ($148 million contract backlog). The rig’s prior dayrate was $450,000.
Transocean Searcher – Customer exercised a one-year option in the Norway North Sea at a dayrate of $386,000 ($141 million contract backlog).
Trident 15 – Awarded a two-year contract extension for work offshore Thailand at a dayrate of $139,000 ($101 million contract backlog). The rig’s prior dayrate was $100,000.
GSF Rig 103 is currently held for sale. The rig was previously stacked.
This report also contains the company’s initial forecast of planned 2013 out of service time. The estimated 2,657 days (impacting 50 rigs) comprises 824 days (31%) for High-Specification Floaters, 872 days (33%) for Midwater Floaters, and 961 days (36%) for Jackups. This compares with estimated 2012 out of service time of 3,931 days (impacting 58 rigs) consisting of 1,212 days (31%) for High-Specification Floaters, 717 days (18%) for Midwater Floaters, and 2,002 days (51%) for Jackups. Included in the 2013 forecast, the company anticipates performing extensive well control equipment work scope on 12 floaters.
These estimates are subject to change due to a variety of factors, including changes in business plans as well as customers’ requirements and new contracts. It is not uncommon for unplanned or exceptional shipyards to significantly increase estimates of out of service time. Since the company cannot predict such shipyards, they are not included in the Fleet Status Report.
The fleet update summary can be accessed at http://www.deepwater.com by clicking on the Fleet Status Report link found in the toolbar.
Forward-Looking Statements
Statements regarding the estimated duration of customer contracts, contract dayrate amounts, future contract commencement dates and locations, planned shipyard projects and other out of service time, sales of drilling units, as well as any other statements that are not historical facts in the report, are forward-looking statements that involve certain risks, uncertainties and assumptions. These include but are not limited to operating hazards and delays, risks associated with international operations, actions by customers and other third parties, the future prices of oil and gas and other factors detailed in the company’s most recent Form 10-K and other filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated.
About Transocean
Transocean is a leading international provider of offshore contract drilling services for oil and gas wells. We own or have partial ownership interests in and operate a fleet of 129 mobile offshore drilling units consisting of 50 High-Specification Floaters (Ultra-Deepwater, Deepwater and Harsh-Environment semisubmersibles and drillships), 25 Midwater Floaters, 10 High-Specification Jackups, 43 Standard Jackups and one swamp barge. In addition, we have two Ultra-Deepwater Drillships and three High-Specification Jackups under construction. The company specializes in technically demanding sectors of the global offshore drilling business with a particular focus on deepwater and harsh environment drilling services, and believes that it operates one of the most versatile offshore drilling fleets in the world.
For more information about Transocean, please visit the website at http://www.deepwater.com.
Source: Transocean Ltd.
more at http://www.rulingthemarkets.com
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Let’s talk “fracking”. Fracking can cost several million dollars per well so companies are continually on the look-out for lower cost options. Recently, Schlumberger has been discussing a new technology that reduces fracking cost substantially.
Fracking a well involves three major costs – proppant (sand/chemical mix), water and trucks. The fracking technology Schlumberger has developed utilizes 40% less proppant and up to 50% less water. Less proppant and less water leads to significantly fewer supply trucks and therefore less operating cost.
JPMorgan has estimated that fracking costs could drop from $2.5 million per well down to under $1 million. A significant cost reduction for natural gas producers.
Lower cost means more oil/gas can be economically recovered (higher company reserves), increasing the overall supply. More supply equates to lower retail prices and more support for our “Investment Case For Natural Gas”………..
Investment Case for Natural Gas – available at http://www.rulingthemarkets.com
Very interesting information about fracking thanks for the comments here Jim. Will be sure to check out the link.