02-18-2015, 04:49 PM
First message on the board. Glad I found ya'll, thanks for having me.
XOM was not one of my core holdings, and when the oil slide began I got excited at the prospect of adding it. I decided against it b/c I'm an extremely conservative investor, and there were a few things about XOM that just made me uneasy. My philosophy has always been not to invest unless I feel totally confident based on my values. It likely has cost me, but piece of mind and conviction are IMO extremely improtant.
1) it's gross margin has slid by 10 percent over the last ten years, and is now < 40%.
2) FCF has slid over the last 10 years
3) based on FCF/market cap and PEG it's very expensive still
4) XOM seems to be borrowing against it's future, with a .89 current ratio
With the short term assets/liabilities as they are, plus hedging on oil's continued slide, I can see why he may have wanted to sell.
With all that said, BRK's goals and the goals of the dividend income investor aren't the same thing. If I owned XOM, I wouldn't be interested in what Buffett is doing, as long as dividends continue to be increased. Since I am not a shareholder, I'm not going to at this time initiate a position either.
XOM was not one of my core holdings, and when the oil slide began I got excited at the prospect of adding it. I decided against it b/c I'm an extremely conservative investor, and there were a few things about XOM that just made me uneasy. My philosophy has always been not to invest unless I feel totally confident based on my values. It likely has cost me, but piece of mind and conviction are IMO extremely improtant.
1) it's gross margin has slid by 10 percent over the last ten years, and is now < 40%.
2) FCF has slid over the last 10 years
3) based on FCF/market cap and PEG it's very expensive still
4) XOM seems to be borrowing against it's future, with a .89 current ratio
With the short term assets/liabilities as they are, plus hedging on oil's continued slide, I can see why he may have wanted to sell.
With all that said, BRK's goals and the goals of the dividend income investor aren't the same thing. If I owned XOM, I wouldn't be interested in what Buffett is doing, as long as dividends continue to be increased. Since I am not a shareholder, I'm not going to at this time initiate a position either.