Oil Investors See $7.4 Billion Vanish as Dividends Are Targeted - Bloomberg Business
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Maybe the unrealized expectation of dividend income should be tax deductible.
Even if prices rebound, companies will be wary about restoring dividends, said Morningstar’s Peters. Their priorities will probably continue to be paying down debt and building up cash reserves to avoid another financial crisis, he said by telephone.
“It could be a lot of years before you see any meaningful rebound in the dividend," he said. “It’s tough to have a really conservative, stable investment in a business that can’t control the price of its own product."
What is factored in? If I didn't have something of a belief in the peak oil idea I would never have become involved here. As far as I am concerned the "fraccing revolution" does not invalidate peak oil.This appears to be already factored in. The sector has been crawling out of its bottom set in late January. Buy, buy, buy?
By the time the media bemoans the dividend cut (what else does one expect with crude price dropping to 1/3 of its previous value?), it's old news and the stocks have already bottomed out.What is factored in? If I didn't have something of a belief in the peak oil idea I would never have become involved here. As far as I am concerned the "fraccing revolution" does not invalidate peak oil.
Still, IMO the big risk here is technological, and as retirees we don't want to go overboard. Like ixnay on "buy, buy, buy". Not that this is necessarily wrong, but it definitely is not prudent.
Ha
By the time the media bemoans the dividend cut (what else does one expect with crude price dropping to 1/3 of its previous value?), it's old news and the stocks have already bottomed out.
Oil will be with us for a long time, despite advances in renewable energy. Regardless, my investment horizon is shorter, in the order of something like 2 to 5 years.
I had sold off most of my energy stocks, and have been slowly getting them back. I have been underweight in energy and am looking to get back to a bit overweight. My "buy, buy, buy" personally never means getting more than 10%.
I think you are correct. Did you run across some charts or something that prompted you to mention this?This surely looks like the entire commodity universe and not just oil as it has been going down steadily for the last 4 years.
This surely looks like the entire commodity universe and not just oil as it has been going down steadily for the last 4 years.
I think you are correct. Did you run across some charts or something that prompted you to mention this?
Ha
Oil will be with us for a long time, despite advances in renewable energy. Regardless, my investment horizon is shorter, in the order of something like 2 to 5 years.
With renewable energy ramping up, coupled with the new supply of oil due to fracking, it is indeed hard to conceive the return of oil to $100+ a barrel. But that does not affect the price recovery of oil-related stocks in the next 2 to 5 years.
About overall commodity, particularly industrial metals which started their decline long before oil, instead of betting on the recovery of the commodities themselves via ETN, I prefer to buy stocks of the producers. XME is one of the granddaddies of ETFs, and I have traded it on/off over the past 15 years. I sold off most last year, but kept a bit for "keepsake". I missed its absolute bottom a month ago, and will look to getting some if it pulls back.
I think you are correct. Did you run across some charts or something that prompted you to mention this?
Ha