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Boone Pickens Sees Oil Going Up, Buys 12 New Oil Stocks
Posted by: guruhl (IP Logged)
Date: August 17, 2012 02:35PM

T. Boone Pickens, billionaire, energy magnate and founder of BP Capital, has been outspoken in support of the advancement of the natural gas industry in the U.S., but said in May that he exited natural gas stocks. He has also advocated exiting OPEC and relying exclusively on domestic energy sources. The 12 new oil positions in his second-quarter portfolio indicate that he followed through on his May comments to CNBC:

“I see all the fundamentals for me are that oil goes up. I’m long a little bit of oil but not much. I’d like to put a position on because I do think we’re going to see a tight market coming up. Ninety-one million barrels a day is now what the demand is globally, and I don’t think the industry is going to be able to fulfill that demand. It won’t be easy. So what’s going to happen is supply is going to be short and you’ll kill demand with price. Now that’s my whole theory on this. Let’s talk in 30 days and see if Boone knows what he’s talking about.”

The five largest new oil producer stocks Pickens purchased in the second quarter are Pioneer Natural Resources (PXD), McMoran Exploration (MMR), Southwestern Energy Company (SWN), EOG Resources (EOG) and Quicksilver Resources (KWK).

Pioneer Natural Resources (PXD)

Pioneer Natural Resources was Pickens’ largest oil company purchase in the second quarter. He purchased 101,485 shares at an average price of $100 per share, equating to 6.9% of his portfolio.

Pickens mentioned in a June interview with CNBC that Pioneer, along with Continental, were among his favorite oil stocks. “They’re both oil plays and it’s incredible how many wells they have to drill, and this is great for our country. To have these resources show up in America at this time has got to be divine intervention,” he said.

Pioneer Natural Resources is an oil and gas exploration and production company with ownership interests in oil and gas properties located in the U.S., Argentina, Canada, South Africa and Gabon. Pioneer Natural Resources has a market cap of $12.09 billion; its shares were traded at around $99.98 with a P/E ratio of 15.9 and P/S ratio of 4.3. The dividend yield of Pioneer Natural Resources stocks is 0.1%. Pioneer Natural Resources had an annual average earnings growth of 9.8% over the past 10 years. GuruFocus rated Pioneer Natural Resources the business predictability rank of 4-star.

McMoRan Exploration (MMR)

Pickens re-opened a position in McMoRan after the price dropped significantly. He purchased 678,421 shares at an average price of $9 in the second quarter. In the first quarter, he sold out 1,096,134 shares at an average price of $13. The stock is up 46% from his second-quarter purchase price.

McMoRan Exploration Co. is engaged in the exploration, development and production of oil and gas offshore in the Gulf of Mexico and onshore in the Gulf Coast region, and in the mining, purchasing, transporting, terminaling, processing and marketing of sulfur. McMoRan Exploration Co has a market cap of $2.26 billion; its shares were traded at around $13.62 with and P/S ratio of 4.1.

Southwestern Energy Company (SWN)

Pickens purchased 264,085 shares of Southwestern Energy Company when the stock declined to $29. He had previously exited his position of 205,242 shares of the company when the price was at $36 in the fourth quarter of 2010.

Southwestern Energy Company is an energy company primarily focused on natural gas. Southwestern Energy Company has a market cap of $11.19 billion; its shares were traded at around $32.26 with a P/E ratio of 21.1 and P/S ratio of 3.8. Southwestern Energy Company had an annual average earnings growth of 26% over the past 10 years. GuruFocus rated Southwestern Energy Company the business predictability rank of 3.5-star.

EOG Resources (EOG)

Pickens purchased 74,046 shares of EOG Resources at an average price of $100 in the second quarter. He previously exited a position of 106,458 shares at an average price of $93 in the fourth quarter of 2011.

EOG Resources is engaged, either directly or through a marketing subsidiary with regard to domestic operations or through various subsidiaries with regard to international operations, in the exploration for, and the development, production and marketing of, natural gas and crude oil primarily in major producing basins in the U.S., as well as in Canada and Trinidad. EOG Resources has a market cap of $29.65 billion; its shares were traded at around $110.93 with a P/E ratio of 25.5 and P/S ratio of 2.9. The dividend yield of EOG Resources stocks is 0.6%. EOG Resources had an annual average earnings growth of 14.9% over the past 10 years. GuruFocus rated EOG Resources the business predictability rank of 2-star.

Quicksilver Resources (KWK)

Pickens purchased 1,216,616 shares of Quicksilver at an average price of $4 in the second quarter of 2012. He had previously exited a position of 614,774 shares at an average price of $14 in the fourth quarter of 2010.

Quicksilver Resources Inc. is an exploration and production company focusing on the development and production of natural gas and oil properties onshore North America. Quicksilver Resources Inc. has a market cap of $793.3 million; its shares were traded at around $4.145 with and P/S ratio of 0.8.

See T. Boone Pickens’ portfolio here. Also check out the Undervalued Stocks, Top Growth Companies and High Yield stocks of T. Boone Pickens.




Guru Discussed: T Boone Pickens: Current Portfolio, Stock Picks
Stocks Discussed: OIL, PXD, MMR, EOG, SWN, KWK,
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