Adding Wolfspeed, Inc. (WOLF) - $108 area NYSE - Nasdaq Real Time Price. C 108.94+4.25 (+4.06%) As of 02:25PM EDT.
© Bloomberg/ rounding up the latest Glencore news every morning. Here’s a chart you may have seen in recent days. It’s the one showing Glencore’s nearly 11 year round trip back to its IPO price. And here’s a chart you probably haven’t seen. It shows Glencore’s shares outstanding over the same period. Explaining the first chart is simple. Company-specific regulatory risks are being cauterised at the same time that commodity prices surged, most notably those of coal. As well as being the world’s biggest commodity trader, Glencore is the only Europe-listed diversified miner that offers meaningful exposure to thermal coal, so has been among the ESG-apathetic investor’s wartime stocks of choice. Chart from Morgan Stanley: In all, about 65 per cent of Glencore’s production is in Russia-centric commodities, with coal by far the biggest earnings contributor, says JPMorgan, whose charts these are: Meanwhile, Glencore’s behemoth marketing business tends to make hay in periods of rising prices and volatility. It’s likely to have done particularly well in the year to date because margin requirements are squeezing out smaller traders. And though Glencore’s own trading book will need to run tighter than in 2021, when marketing delivered a record $3.7bn EBIT, the share gains should make the through-the-cycle range of $2.2-3.2bn EBIT easy to hit. Everyone knows this already, however. The stock’s 43 per cent year-to-date rally (orange line, right axis) has a wholly unsurprising correlation with consensus EPS expectations (cyan line, left axis): Glencore’s difficult decade can be better understood via the shares outstanding chart, where the big events are easier to spot. Most obvious is a near doubling of the share count in 2013 for the $30bn takeover of Xstrata. After that is a step higher for the cash call at the fag end of the Bric commodities supercycle in 2015, when investor confidence was shot. Bookending these events are gradual share count declines. The first, beginning in 2014, was on a $1bn share buyback because then-CEO Ivan Glasenberg didn’t want a “lazy” balance sheet. (His definition of lazy wasn’t widely shared: Glencore’s net debt was nearly 10x ebitda when the Xstrata deal completed.) The more pronounced decline starting in July 2018 reflects regular repurchases as Glasenberg and his successor Gary Nagle sought to signal that the company was less worried about bribery and corruption investigations than investors might be. Zooming into the post-Xstrata period offers a clearer view: As shown, nearly four years of buybacks have succeeded only in returning Glencore’s share count to where it was immediately before its 2015 near-death-experience. Shares issued back then at 125p have been clawed back over five separate repurchase programmes at prices between 300p and 535p. In essence, the $2.5bn emergency cash call ended up costing Glencore around $5.2bn. Which is fine, because what’s done is done. Mining investors want cash returns not value-destroying M&A and top-of-the-cycle capex. Glencore’s buybacks are one element of a formulaic cash return programme seemingly designed to lend confidence that it won’t be buying another Xstrata. Thermal coal is being managed into gradual obsolescence within the group rather than spun off — Glencore’s target date for hitting net zero total emissions is 2050 — so dirty cash (in the smog sense) can fund a year or two of cash returns higher than any other diversified miner. RBC Capital Markets forecasts a $13bn average annual free cash flow through to 2025, suggesting double-figure dividend yields are possible. Potential disposals, such as a sale of its 49.9 per cent stake in agricultural business Viterra, can add another few billion to the buyback pool. On the liabilities side, current lawsuit expenses have been capped at $1.5bn and the windfall tax lobbyists have yet to take an interest in coal. There’s always a risk that the marketing division gets on the wrong side of something, but a house value-at-risk limit ($150mn / 95 per cent confidence interval) seems for the moment to be working. M&A remains deeply off limits due to the mess made last time so there really is nowhere for spare cash to go other than back to shareholders. Dwelling on the after effects of a 2015 rights issue may seem unnecessary, given all that, which is why no one is. Of the 17 brokerages to have issued sellside research on Glencore this year, all but two rate the stock a buy. Investors meanwhile are paying nearly 18 times trailing EPS in a peer group where PEs average about 6 or 7. Yet for all the guff about Nagle making Glencore more predictable and ESG friendly, the stock’s recovery back to 2011 levels has been almost exclusively powered by the coal spike. A Bloomberg total return analysis screen shows that even with all dividends reinvested, an investor buying in at the IPO was only breaking even at the start of 2022: A common argument from analysts is that even when the war bonus dissipates, Glencore’s overweighting towards battery materials will make it a better bet than peers over-reliant on iron ore. It’s an image Glencore seems to like, with greenish deals such as a multiyear agreement announced today to ship cobalt to General Motors given the full press release treatment. But any ambition Glencore has to grow quickly in these areas is hemmed in by Nagle’s rigid dividend policy and through-the-cycle target debt range of $10-16bn, all of which lock in a cash return policy whose long-term value to holders so far has been underwhelming. As the $5.2bn round trip shows, Glencore’s timing of the market over its listed life has been little better with capital returns than it has been with M&A. Yet shareholders who have a deep resistance honed by experience to any long-term investment seem much more ready to forgive and forget when it comes to getting cash back.
Van this Australian Whitehaven is a cleaner story- Whitehaven Coal Limited (WHITF) Other OTC - Other OTC 3.2900-0.0300 (-0.90%)
Currently this is the only coal holding in Bare Essentials Portfolio/ has not done much. Warrior Met Coal, Inc. (HCC) 37.38+1.16 (+3.20%) As of 02:36PM EDT.
The gun jammed. If there is any good news this dreadful day it is the gun jammed. Could of been a massacre. As it is ten shot. Weird gas smell -I think he had bombs too. This is a terrible blow to NYC. Already struggling from these work at home types. Kids were going to school on that train. A lot of kids use the subway system...
NFE In a beautiful base since April 6--> NFE after $22---> $44 run up!!! No retrace of note and flat across that is a very good sign./// New Fortress Energy Inc. (NFE) NasdaqGS - NasdaqGS Real Time Price. Currency in USD 41.76+0.47 (+1.14%) As of 02:44PM EDT. Market open.
Is SONOS a BARE ESSENTIAL-? It's a tough argument to make. But in some cases a SONOS is a radio and radio is still a Bare Essential (just barely) Sonos call volume above normal and directionally bullish 15:05 SONO
This caught my eye the other day-/ Stk has really held up well. Might be an emerging leader next phase Sonos acquiures 'audio transducers' firm Mayht for $100M to enhance portfolio 09:06 SONO Sonos announced the acquisition of Mayht Holding BV, a Netherlands-based company that has invented a new, revolutionary approach to audio transducers. Transducers are the foundational element within speakers that create sound, and Mayht has re-engineered them to enable smaller and lighter form factors without compromising on quality. "Mayht's breakthrough in transducer technology will enable Sonos to take another leap forward in our product portfolio," said Patrick Spence, CEO. "This strategic acquisition gives us more incredible people, technology and intellectual property that will further distinguish the Sonos experience, enhance our competitive advantage, and accelerate our future roadmap." Under the terms of the agreement Sonos acquired Mayht for approximately $100M in existing cash on hand. Further details will be provided on Sonos' Q2 earnings call in May.
SQM named short-term buy idea at Deutsche Bank 18:39 SQM Deutsche Bank analyst Corinne Blanchard placed a "Catalyst Call: Buy" on shares of SQM as a short-term idea. The analyst sees the company's Q1 results as a potential catalyst as it stands to benefit from pricing tailwinds in most of its business segments. Blanchard adds that the market is underestimating SQM's earnings power this year. Blanchard keeps a Buy rating and $98 price target on SQM shares.
Van I forgot ARLP ( just the other day) we have 2 coal stks - Energy stocks stood apart amid the general weakness, finishing among the big winners. This was especially true of coal stocks, with Peabody (BTU), CONSOL (CEIX) and Alliance (ARLP) all finished notably higher.