what to do with cop?

[EricL]

(10-04-2017, 04:43 PM)Joey Batz Wrote: I see what you guys are saying.

I actually do have some ideas for where to route the funds from the money (other dividend stocks, not a fancy car or iPhone or anything ), and like I said, the tax lost harvesting will also make up for my selling half of my CAT stake a few weeks ago.

Looking at some of these numbers, though, makes me wonder if money is better allocate elsewhere. Right now, I'm seeing a NEGATIVE EPS. I don't recall any major acquisitions or anything that would have created more spending than revenues (correct me if I'm wrong); I'm fairly certain they actually sold some assets this year. How am I seeing negative earnings? And their forward P/E is very high too. That indicates overvaluation to me. I know that oil prices won't stay where they are forever, but who knows where things will be for the next foreseeable future (roughly 10 years)? I don't want to start making any bets on commodity prices other than the broad fact that we will still be using that commodity 30 years from now. I don't think oil is going to crash again, but do we really think it will go up to the record highs of 2013 as the technology for drilling improves? I don't think so, and remember that this is a pure play upstream company here.

I should also point out that the companies I'm thinking of to buy have higher yields and lower forward P/Es.

What is it I'm missing here with these numbers, guys? What am I REALLY seeing when I look at COP's negative EPS and near-30 forward P/E?

COP is in a cyclical industry, and that industry is in its 3rd year of a downturn. I think we are close to a point where prices are headed higher, but in the meantime the E&P companies are going to continue to tread water. Once crude prices head higher, those EPS estimates will rise accordingly, and the PE will shrink.

I think COP is a decent enough company, but I prefer those with more exposure to the Permian like EOG or OXY or the integrated oil companies like CVX or XOM. None of them cut dividends, and OXY, CVX, and XOM have all continued to raise payouts during the recent downturn.