One of the oil industry gurus I follow isn't high on DVN. In a nutshell, it's management related. He said that they operate more like 3 separate companies than one, and capex allocation isn't the most efficient. His best argument for holding DVN was the possibility that someone would acquire the company for a big fat premium and put the assets to better use. Said he'd MUCH rather own OXY or EOG and that either would beat whatever DVN does by 10-15%. One thing to keep in mind about investing in companies that operate in the Permian. While production will remain steady for years, liquids production has peaked and will soon begin to decline. This means more gas and water for every bbl of oil extracted. Having the best rock is about to become a LOT more important.
I wouldn't mind if DVN is acquired, but can't see it happening just now. I would rather own EOG than OXY (at the current price) or even DVN on sale. But, there are still many good buys in the energy sector to add to one's portfolio. Thanks for the info and comments!
Yep. Those of us with bets at the time on OXY are quite familiar with the critical importance of the timing issue of acquisitions, having gotten slammed by Holly's incredibly bad (uncanny, really) timing with the Anadarko deal. As always Rudy, much appreciate your analysis, and many thanks for the update on DVN.
It's interesting that OXY didn't get much of a bounce today, after the news that Buffett has up his ownership again, last week? In theory, OXY should be trading at ~$75 right now, but that's not how markets work :) Take care, best regards!
Hello redexit0707, sorry for the late reply! Much like the analysts (16) that cover @APA, I'm a little on the fence with this equity. Of these, nearly half (7) say hold. I'm okay with that, and there are many better energy buys than a new position in APA. I think APA's most recent underperformance was a bit of a shock to longs. Missing the expected EPS by 16% was too much, especially since the expectation was already >40% below the same quarter, last year. Since you asked, I assume you're long APA? If so, your APA is like my DVN. The stock price recovery will be a bumpy road, and we also risk unforeseen events that might cause an even greater pullback. I'm in the "hold camp" and would not be comfortable exiting a long position or initiating a new position at this time (for both APA & DVN). My best!
@@BesterInvestor Thank you very much for your perspective. Most importantly, thank you for taking the time to answer my question. Sincerely appreciate it.
A turnaround would be nice, and it's overdue. But they're struggling for positive news, looking for some traction, higher prices, etc. We can just wait and see. I don't like taking losses and my cost basis is just below $50... so I'll just be patient. Best regards!
Still looks like a buy to me, especially with the recent dip. How do you think Biden's tax proposal of shifting tax subsidies from fossil fuels to "clean energy", will affect these stocks? If it will be negative, I wonder if looking outside the US, or at royalty trusts, will be more lucrative in the short term.
Look at what's happening in the EU right now. It appears to be a shift that includes the Netherlands, Germany, France, etc. I think Biden will be gone soon - if not via the polls, then probably because the dems know they need a winner of sorts. They're playing a losing game and their lawfare strategy against Trump isn't working as they had imagined? Take care, my best!
I think so too Nathaniel, but $DVN management will also need to execute expertly, and ensure that they stay focused on strong FCF, dividends, smart capex spending, and a good growth strategy! My best.
@@BesterInvestor The Rimrock acquisition was a debacle, I think with the Grayson Mill Acquisition they could be in the penalty box for a couple quarters until they can prove this isn’t another Rimrock. On a side note I did notice their over all production volumes will be 55% oil now after Grayson Mills.
There are many better buys. Just now, the price for natural gas is below the cost of production. That's a primary reason for the pullback. And the more they drill in the Permian (very profitable), the more NGL they produce, as a by-product of shale production. A catch 22?!
Hello Rudy my friend! What do you think about ALTM? It is dirt cheap right now and over the years may be worth quite a bit. I just bought $10k worth but I have weak hands so it may be a trade. I just wanted to let you know about it. See what you think.
Hello Joe! I don't invest in lithium. The demand is nearly 100% dependent on car battery growth and EV sales are declining, or at least under pressure. I think $TSLA is doing to have a brutal quarter, and that's the US' only real player in the EV space. Do you know why ALTM was ~$10 a year ago and now it's ~$3? I'm not sure, but maybe it's cheap for all the wrong reasons? Let me know what you think.
I know you did a video a few years ago, but have you looked into Harbour Energy recently? I know that my government is hell bent on killing the UK north sea and I give that no value. But the takeover of Wintershall Dea is going to make them one of the largest and most diversified independents there is. It might be worth a look as they are still very cheap.
Hi Adam, I have not looked at Harbour for some time. I agree they deserve another look, albeit for all the right/wrong reasons, as you had mentioned. Thank you, my best!
I Bought 37,100 shares today at $43.19/share.
Incredible OPPORTUNITY !
@@mikemadden3967 best of success!
And now less than 40
FINALLY Got Out 10/11 With A SMALL Profit.
After Being Down 200K Plus.
@@johannemonfiston7484 SOLD 10/11 At A Small Profit.
Plus Picked Up Almost A $16,500 Dividend.
@@mikemadden3967 will done! I also exited DVN.
One of the oil industry gurus I follow isn't high on DVN. In a nutshell, it's management related. He said that they operate more like 3 separate companies than one, and capex allocation isn't the most efficient. His best argument for holding DVN was the possibility that someone would acquire the company for a big fat premium and put the assets to better use.
Said he'd MUCH rather own OXY or EOG and that either would beat whatever DVN does by 10-15%.
One thing to keep in mind about investing in companies that operate in the Permian. While production will remain steady for years, liquids production has peaked and will soon begin to decline. This means more gas and water for every bbl of oil extracted. Having the best rock is about to become a LOT more important.
I wouldn't mind if DVN is acquired, but can't see it happening just now. I would rather own EOG than OXY (at the current price) or even DVN on sale. But, there are still many good buys in the energy sector to add to one's portfolio. Thanks for the info and comments!
Good to see you Rudy
Awesome information thank you
Glad it was helpful!
Thanks for sharing your thoughts
Thanks for watching!
Welcome back.
Yep. Those of us with bets at the time on OXY are quite familiar with the critical importance of the timing issue of acquisitions, having gotten slammed by Holly's incredibly bad (uncanny, really) timing with the Anadarko deal.
As always Rudy, much appreciate your analysis, and many thanks for the update on DVN.
It's interesting that OXY didn't get much of a bounce today, after the news that Buffett has up his ownership again, last week? In theory, OXY should be trading at ~$75 right now, but that's not how markets work :) Take care, best regards!
Thank you for your investment views? If possible what do you think of APA?
Hello redexit0707, sorry for the late reply! Much like the analysts (16) that cover @APA, I'm a little on the fence with this equity. Of these, nearly half (7) say hold. I'm okay with that, and there are many better energy buys than a new position in APA.
I think APA's most recent underperformance was a bit of a shock to longs. Missing the expected EPS by 16% was too much, especially since the expectation was already >40% below the same quarter, last year.
Since you asked, I assume you're long APA? If so, your APA is like my DVN. The stock price recovery will be a bumpy road, and we also risk unforeseen events that might cause an even greater pullback. I'm in the "hold camp" and would not be comfortable exiting a long position or initiating a new position at this time (for both APA & DVN).
My best!
@@BesterInvestor Thank you very much for your perspective. Most importantly, thank you for taking the time to answer my question. Sincerely appreciate it.
I own a few share of DVN long. Good dividend. Looking for a turn around. Best!
A turnaround would be nice, and it's overdue. But they're struggling for positive news, looking for some traction, higher prices, etc. We can just wait and see. I don't like taking losses and my cost basis is just below $50... so I'll just be patient. Best regards!
Still looks like a buy to me, especially with the recent dip.
How do you think Biden's tax proposal of shifting tax subsidies from fossil fuels to "clean energy", will affect these stocks? If it will be negative, I wonder if looking outside the US, or at royalty trusts, will be more lucrative in the short term.
Hopefully Dementia Joe is on his way out.
Look at what's happening in the EU right now. It appears to be a shift that includes the Netherlands, Germany, France, etc. I think Biden will be gone soon - if not via the polls, then probably because the dems know they need a winner of sorts. They're playing a losing game and their lawfare strategy against Trump isn't working as they had imagined? Take care, my best!
With so much negative sentiment against the stock there shouldn’t be to many more sellers of the stock.
Should set up well for future outperformance
I think so too Nathaniel, but $DVN management will also need to execute expertly, and ensure that they stay focused on strong FCF, dividends, smart capex spending, and a good growth strategy! My best.
@@BesterInvestor The Rimrock acquisition was a debacle, I think with the Grayson Mill Acquisition they could be in the penalty box for a couple quarters until they can prove this isn’t another Rimrock.
On a side note I did notice their over all production volumes will be 55% oil now after Grayson Mills.
I sold it at even about 2.5 mnths ago after suffering large downs.
There are many better buys. Just now, the price for natural gas is below the cost of production. That's a primary reason for the pullback. And the more they drill in the Permian (very profitable), the more NGL they produce, as a by-product of shale production. A catch 22?!
Hello Rudy my friend! What do you think about ALTM? It is dirt cheap right now and over the years may be worth quite a bit. I just bought $10k worth but I have weak hands so it may be a trade. I just wanted to let you know about it. See what you think.
Hello Joe!
I don't invest in lithium. The demand is nearly 100% dependent on car battery growth and EV sales are declining, or at least under pressure. I think $TSLA is doing to have a brutal quarter, and that's the US' only real player in the EV space.
Do you know why ALTM was ~$10 a year ago and now it's ~$3? I'm not sure, but maybe it's cheap for all the wrong reasons?
Let me know what you think.
@@BesterInvestor I think you are spot on. I was looking at a bounce (swing) trade. Didn't know if you were interested for a long run show.
Great video 👍
Thanks for the visit
I know you did a video a few years ago, but have you looked into Harbour Energy recently? I know that my government is hell bent on killing the UK north sea and I give that no value. But the takeover of Wintershall Dea is going to make them one of the largest and most diversified independents there is. It might be worth a look as they are still very cheap.
Hi Adam, I have not looked at Harbour for some time. I agree they deserve another look, albeit for all the right/wrong reasons, as you had mentioned. Thank you, my best!