Pair Trade: PBR/A, PBR
Petrobras - Petroleo Brasileiro S.A.
Energy, Industrial/Transportation, Event Driven/Special Sit
02/25/2015
Presented
| Date | 02/20/2015 |
| Price | $6.66 |
| Market Cap | $44.50B |
| Ent Value | $135.79B |
| P/E Ratio | 5.9x |
| Book Value | $18.61 |
| Div Yield | N/A |
| Shares O/S | 6.52M |
| Ave Daily Vol | 17,850,000 |
| Short Int | N/A |
Current
| Price | $14.42 |
| Market Cap | $53.66B |
| Petróleo Brasileiro S.A. – Petrobras operates as an integrated oil and gas company in Brazil and internationally. Its Exploration and Production segment is engaged in the exploration, development, and production of crude oil, natural gas liquids, and natural gas; sale and transfer of crude oil in domestic and foreign markets; and sale of oil products produced at natural gas processing plants. The company’s Refining, Transportation, and Marketing segment is involved in the refining, logistics, transport, and trading of crude oil and oil products, as well as exports ethanol and invests in petrochemical companies. This segment is also engaged in the extraction and processing of shale. This segment’s products include gasoline, diesel, and residential liquefied petroleum gas. The company’s Gas and Power segment is engaged in the transportation and trade of natural gas; transportation and trade of liquid natural gas; generation and trade of electricity; holding interests in natural gas distribution and thermoelectric power stations; and fertilizer business. Its Biofuel segment is involved in the production of biodiesel and its co-products, as well as in the production and marketing of ethanol, sugar, and the electric power generated from sugarcane bagasse. The company’s Distribution segment distributes oil products, ethanol, and vehicle natural gas in Brazil to retail, commercial, and industrial customers, as well as other fuel wholesalers. Its International segment is engaged in the exploration, production, refining, transportation, marketing, and distribution of gas and power in the Americas, Africa, Europe, and Asia. As of December 31, 2013, the company had proved developed oil and gas reserves of 7,605.8 million barrels of oil equivalent (mmboe) and proved undeveloped reserves of 4,934.5 mmboe in Brazil. Petróleo Brasileiro S.A. - Petrobras was founded in 1953 and is headquartered in Rio de Janeiro, Brazil. |
Please note the presenter closed out his or her position on 4/23/2015. This idea was updated on 4/13/2015 and can be read here: Pair trade: PBR/A - Long, PRB - Short.
Publicly traded companies mentioned herein: Petroleo Brasileiro SA (PBR; PBR/A)
Highlights
The presenter is long Petrobras preferred ADR shares (PBR/A) and short Petrobras common shares (PBR) in a pair trade. He thinks company statements asserting the possibility of zero dividends are misleading and preferred shares should trade at a larger premium over common shares (PBR). He speculates there may be 10% upside on the preferred shares over the next 3 – 4 months as well as declines on the common shares as the dividend situation becomes clearer, combining for a 70 cent gain on the pair trade.
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