Tag Archives: Carl Icahn

Expensive oil shale revolution

Asian shares fell today and the Japanese yen rose as the growth in Chinese home prices eased for the first time in 14 months. Tokyo`s Nikkei index fell 0,2%. Tokyo stocks are also down, while the activity in its major export is declining.

 

European stocks and the Euro got a boost on Monday as the German carmaker Volkswagen came with a disappointed outlook with limited gains. Right after Viktor Yanukovich was ousted rom the presidency in Ukraine, the country`s dollar bonds skyrocketed, and the hryvnia currency fell.

 

On the commodities front, Brent crude is down -0,15% to $109,68. Gold is up for a third week in a row, to $1,334,10, up +0,79%. Silver is up 0,76%, to $21,98 and Copper is down together with the markets, to 322,00, down -1,23%.

 

Chesapeake Energy (CHK)

Chesapeake Energy (CHK) is pursuing strategic alternatives for its oilfield services division. The Oilfiesld Services generataed revenue of $2,2B last year. The investor Carl Icahn own 10% of the shares in Chesapeake Energy. Rumors say he is seeking a cash bid of up to $40 a share.

 

Rising natural gas prices could help the company to profit off a plan to revive the maligned Haynesville shale play, where it gambled billions of dollars six years ago. The rigs they have could boost daily rates for the U.S land drilling company.

 

Chesapeakes Energy`s plan would increase the number of Haynesville rigs 25% – 50 by the end of this year. Renewed gas drilling could drive up margins for U.S rig contractors. CHK have spent a lot of money in oil shale drilling, so higher demand will help then in the future.

 

It will be interesting to see who buyer will be in CHK. Is it gonna be Icahn, Exxon Mobil or ConocoPhillips? All of them are potential buyers while European majors disqualify themselves. Carl Icahn sold half of his stake in Netflix last year. He have success with investments in Herbalife (HLF) and Apple (AAPL) too.

 

Selling half of his shares in Netflix gave him a profit of $800 million. Carl Icahn started in 1980`s as an activist investor and there has never been a better time for activist investing than today. Activist involvement is necessary to ensure the competitiveness of corporate America. Chesapeake Energy is more of a restructuring play right now. CHK will probably continue to sell itself piece by piece.

Reports today:

10:00 AM ET CB Consumer Confidence

 

CHK

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Earnings

Japan`s Nikkei tumbled -2,75% today. Nikkei suffered the biggest one day loss since august, hit by yen`s strength against the dollar. Investors tend to fear that tight credit conditions in China will put the brakes on the world`s second largest economy. The rest of the Asian markets are also a little bit down. The european market is also a little bit down. Seems like the strong Euro hurts the earnings. Gold is up 1,2% to $1.346,60.

You have probably seen the father and son drama over Netflix stake? Billionaire investor Carl Icahn mean he did the right thing when he sold his Netflix stake, possibly worth hundreds of millions of dollars. But his son Brett, disagree. Icahn acquired Netflix shares for an average price of $58. Netflix shares are now trading at $331,22.

Carl Icahn cut his 9,4% stake by more than half to 4,5%. As I was writing about yesterday about risk/reward and how to buy stocks earlier, Icahn have, for all I know already decided when to go out and sell.

It will be interesting to see who of them, father or son, who was right. Anyway, It`s never wrong to take some profit. If the stock plummet, Carl Icahn can buy more. If the stock continue to go up, he still have 50% of the stocks in Netflix in his portfolio.

Earning came in yesterday. Here is some of them:

Microsoft (MSFT) beats estimates and shares rise +5,8% AH. EPS of $0,62 beats by $0,08. Revenue of $18,53B (+16% Y/Y) beats by $740M.

Zynga (ZNGA) beats Q3 estimates and shares soar. Up +11,3% AH. Q3 EPS of -$0,02 beats by $0,02. Bookings of $152,1M (-40% Y/Y) beats by $8,4M.

Samsung investing in Corning (GLW) +20,7% AH. Full Q3 results arrive on Oct. 30. GLW is taking full control of the Samsung Corning LCD glass JV. 43%-owned by Samsung Display. The Company says it expects to report Q3 revenue of $2,1B (+10% Y/Y) and EPS of $0,33.

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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