Ratings cut on Chesapeake Energy, other oil and gas producers :Outlooks Cut to Negative by S&P in Oil Slump


Exxon Mobil Corp. and Chevron Corp. were among several U.S. oil and natural gas producers that had their outlooks or ratings cut by Standard & Poor’s as the industry suffers from weak crude prices, hurting their cash flow and liquidity.

S&P cut ratings for Chesapeake Energy Corp., Denbury Resources and Whiting Petroleum Corp., while giving Exxon and Chevron “negative” outlooks, the ratings agency said Friday in a statement. Exxon “has substantially more debt than during the last cyclical commodity price trough in 2009, while upstream production and costs are at similar levels,” S&P analysts Thomas Watters and Carin Dehne-Kiley said.

Oil prices have fallen 58 percent from last year’s peak, threatening $1.5 trillion in North America energy investments, according to Wood Mackenzie Ltd.  Oil has been stuck near $45 a barrel as U.S. crude stockpiles stay about 100 million barrels above the five-year seasonal average and OPEC pumps at near-record levels.

Exxon is one of only three U.S. industrial issuers to have a triple-A bond rating, along with Johnson & Johnson and Microsoft Corp. The oil company has held that grade from S&P since at least 1985, according to data compiled by Bloomberg.

The last U.S. company to lose the triple-A designation from S&P, as well as Moody’s Investors Service, was Automatic Data Processing Inc., which was stripped of the ratings after spinning off its auto-dealer services unit in April 2014.

Chevron has been rated AA by S&P since at least July 1987, Bloomberg data show.

“Most rating actions reflect lower credit-protection measures, negative cash flow, and uncertainty about liquidity over the next 12 months,” S&P said in the statement.

Natural Gas Breaks Three-Year Low

The U.S. EIA said producers added 98 billion cubic feet of natural gas to storage last week

Natural gas plummeted to a new three-year low as heavy surpluses deepen a selloff.

It is the latest leg down for a commodity that has struggled for years under the weight of a record-setting oil-and-gas boom. Production has hovered around all-time highs for about a year, which eventually became too much for prices that had managed to stabilize and outperform most other commodities for the past several months.

Prices for the front-month November contract fell 9.1 cents, or 3.6%, to $2.433 a million British thermal units on the New York Mercantile Exchange. It is the largest one-day loss in seven weeks and the lowest settlement since June 13, 2012.

Gas had managed to tread water this summer and even briefly hit a bull market in the spring because of surging demand from power plants that are switching away from coal. But in recent weeks that demand has subsided along with hot weather and the use of air conditioners, causing surpluses to build up and prices to fall.

The U.S. Energy Information Administration said Thursday morning that producers added 98 billion cubic feet of natural gas to storage in the week ended Sept. 25. It follows a 106-bcf addition last week, the largest weekly additions since early June.

The EIA update is widely considered one of the best measures of supply and demand for the natural gas market. Tudor, Pickering, Holt & Co., a Houston investment bank, had estimated before the data that a weekly addition of this kind would equate to about 3 bcf of oversupply last week.

Storage levels are threatening to start the winter heating season at record highs. Last week’s addition put them at 4.5% above their five-year average level for this week of the year and 15% above their level at this time a year ago.

That helped push prices below those multi-year lows, which could also encourage chart traders to push even lower, said Scott Gettleman, an independent trader in New York. He has been in spread trades Thursday that would benefit as prices fall, he said.

“I just don’t see a reason to rally right now,” Mr. Gettleman added. “You’ve got to wait until at least some cold weather comes in.”

Weather forecasters are predicting a mild start to autumn and heavy East Coast rains from Hurricane Joaquin. Both can lead to soft demand for natural gas, and have traders and analysts expecting more large weekly surpluses in the months to come.


Protect your portfolio profits http://www.youroffshoremoney.com

Microsoft is hosting an event on October 6- What To Expect

Microsoft is hosting an event on October 6, the tagline of which is: “We have some exciting news to share about Windows 10 devices.” While this is not as subtle as Apple’s event invites — which contain, if anything, misdirection — there is still a big grey area surrounding exactly what Microsoft will, and won’t, unveil.

According to Netmarketshare, Windows 10 now has a little over 5% of the total marketshare for PC operating systems which is still under half of Windows 8.1. One of the best ways to make the new OS a compelling purchase — or, as the case may be, free download — is the hardware that it runs on. Evidently this is the next wave of Microsoft’s plan.

Over the past few months there has been a constant drip-drip-drip of news, mainly focused around Microsoft’s smartphone plans, that will culminate into actual products early next month.

Here’s what we expect to be released.

New Lumia smartphones.
New Lumia smartphones.

A leaked image of the Lumia 950XL, the larger of the two devices.
Despite taking a $3 billion (£1.97 billion) write-down on its Nokia acquisition, Microsoft is still intent on being in the smartphone game and the October event will further these ambitions.

The last Windows flagship device, the Lumia 930, was unveiled in April 2014 and so Microsoft is clearly ascribing to the “better late than never” school of thought.

The new devices will be called the 950 and the 950XL, continuing the naming trend of previous Lumia phones. The “smaller” of the devices will have a 5.2-inch display, placing it in between the iPhone 6S and 6S Plus, while the 950XL comes with a gigantic 5.7-inch screen.

Cameras will be a big part of the new Lumia range, again in keeping with the heritage that comes from devices like the Lumia 1020. There are currently no test shots in existence, but Nokia built up a reputation for making good camera phones, so it’s likely that will continue.

Beyond this, the new Lumia devices are also rumoured to come with USB Type-C-enabled “Quick Charging” — enabling a 10% to 95% charge in 25 minutes — alongside the full Windows 10 Mobile experience.

A new Surface Pro 4.

A new Surface Pro 4.

The current Surface Pro 3, on which the newer model will be based.
Microsoft’s updated Surface Pro, called the 4, will be one of the most interesting products shown off on stage.

Previously, the Surface Pro has acted as a catalyst for other hardware manufactures, a strategy that appears to have started working.

The new Surface Pro 4 will most likely retain the design of the Pro 3, albeit with minor changes to the size, while updating the internals to deliver more power and better battery life. Whether Intel’s latest “Skylake” chipsets make it into the new device remains to be seen, however, as reports suggest the device will be fanless, requiring Intel’s Broadwell chipsets.

Apple recently unveiled the iPad Pro and so eyes will be on Microsoft to compete with a device that will more than likely blast past the Surface Pro in terms of sales. One of the deciding factors between the two will be the Office suite, a cornerstone of productivity that makes the Pro 3 into a viable work machine.

While the future of Microsoft doesn’t ride or die on whether the Surface Pro 4 is a hit, the company’s credibility when it comes to hardware manufacture — an area it has invested billions of dollars in — could take a hit.

An updated Microsoft Band.

An updated Microsoft Band.

Microsoft’s Band version one received mixed reviews.
The Microsoft Band, unveiled in October 2014, is expected to get a refresh at the event, focusing on the design of the device.

The first generation Band came as somewhat of a surprise, pushing Microsoft into an area of wearables that it had little experience in. As a result, the Band received mixed reviews and did not go on to become a commercial success.

Version two, according to various leaks, will double down on the design, making it a device that is comfortable to wear and aesthetically pleasing. After the introduction of the Apple Watch, consumers became far more intolerant of ugly wearables, something Microsoft quickly became aware of.

One of the most interesting aspects of the Band is how it fits into the broader “One Windows” strategy. The device runs Windows 10, just like the Surface, and is another component in Microsoft’s strategy to get everyone using operating system. The analytics produced by the Band can also be used by Microsoft, especially in the workplace.


An update on the HoloLens project.
An update on the HoloLens project.

HoloLens is part of the Windows 10 Holographic project.
While the launch of HoloLens is still some way off, the October 6 event may be used to keep interest in one of the more exciting parts of Microsoft’s business alive.

For a company that does most of its business selling servers to enterprise clients, HoloLens is a big investment, and it’s clear that Microsoft believes that the potential of “Windows Holographic” is huge, both with consumers and companies.

What exactly Microsoft will show off is unclear, and the company may well choose to keep HoloLens off stage to focus on smartphones, the Band and the Surface but a quick update on where the company is in its “five year journey” isn’t too unlikely.

Getting businesses excited by new apps could be one aspect of the presentation, just as the company did earlier this year.

An updated Xbox.

An updated Xbox.

The Xbox One was released in November 2013.
Apple recently unveiled a new TV which, among other things, has the ability to play iOS-style casual games. While this isn’t a threat to Xbox’s gaming ambitions, it takes a chunk out of Microsoft’s already flagging dominance in the living room.

While it may seem strange to cameo a gaming device alongside computer and smartphone hardware, the new Xbox runs a version of Windows 10, meaning that many features that are available on a PC are also available on an Xbox, and vice versa.

Repurposing the Xbox One as a living room device, rather than a games console, may help sales and would increase Microsoft’s position away from the work place. The content available for Windows 10 — specifically in regards to the media and app stores — helps this mission.

A Surface Phone?

A Surface Phone?

A concept of the Surface Phone.
The Surface Phone has been the subject of numerous leaks over the past months as Microsoft attempts to double down on a cohesive brand message focused, unsurprisingly, around the “Surface.”

While it’s unlikely we’ll see a new Lumia range AND a Surface Phone at the October 6 event, Microsoft will make moves in that direction before the end of 2016.

Anyone who has used a Surface Pro can understand the appeal of a Surface Phone with its angular, metallic design and powerful internals that have become the hallmark of what is arguably Microsoft’s greatest product of recent times.

An interesting move for Microsoft would be positioning the Surface Phone as a more enterprise-y device — like the Surface Pro — and bundling the Surface Pen with it, letting the Lumia range appeal to consumers.

Seeking an Asset Protection Trust – Read http://www.youroffshoremoney.com

The Five Worst-performing S&P 500 Stocks In The Past Month.




Here’s a list of the five worst-performing S&P 500 stocks over the past month.

5. CF Industries Holdings Inc (NYSE: CF)

CF Industries’ stock has declined 16.8 percent over the past month, as the company continues to suffer from falling fertilizer prices. Now trading at around $46, the stock has put quite a bit of distance between its share price and the $71 target that Barclays set for the stock back in August.

4. Columbia Pipeline Group Inc (NYSE: CPGX)

Columbia’s shares have fallen 17.2 percent over the past month and are now down 38.3 percent year-to-date. Disappointed investors can take comfort in the fact that the president of the company apparently sees the decline as a buying opportunity and recently purchased nearly 30,000 shares at a price of $24.31.

3. NRG Energy Inc (NYSE: NRG)

NRG has had a rough year this year, declining 41.5 percent in 2015. Things haven’t gotten any better for shareholders in the last month, as the stock declined another 18.1 percent on news that Moody’s has placed NRG Yield Inc (NYSE: NRGY) on review for a credit downgrade.

2. Wynn Resorts Ltd (NASDAQ: WYNN)

Investors in Macau-exposed names endured another month of weak gaming revenue numbers, fears over the health of the Chinese economy and concerns over increasing government regulation. Wynn’s shares dropped 20.9 percent in the past month and have declined 59.0 percent year-to-date.

1. Joy Global Inc (NYSE: JOY)

The honor of the worst September investment so far go to Joy Global. Slumping commodity prices and Chinese construction forecasts, as well as Caterpillar Inc (NYSE: CAT)’s disappointing guidance drove Joy Global shares down 31.5 percent over the past month, the worst monthly drop of any stock in the S&P 500.

Joy global is now down 65.8 percent year-to-date, the second worst performance of any S&P 500 stock in 2015. CONSOL Energy Inc (NYSE: CNX) shares have fallen 67.6 percent year-to-date.

Disclosure: the author holds no position in the stocks mentioned.

for better advice on protecting your portfolio profits read http://www.youroffshoremoney.com

Glencore in Freefall

  • Shares of FTSE 100’s worst peformer plunged more than 30%
  • More substantial restructuring needed, Investec warns

Glencore Plc plunged as much as 31 percent, extending a rout that’s wiped more than $14 billion off its value this month and highlighting investor concerns that it’s not cutting its debt load quick enough.

Chief Executive Officer Ivan Glasenberg’s debt-reduction plan announced three weeks ago and the move to sell a stake in its agricultural business reported by Bloomberg on Friday has failed to stanch the bleeding. Investec Plc warned Monday that there was little value for shareholders should low raw-material prices persist.

“In the current climate, debt is fast becoming the most important consideration,”Hunter Hillcoat and Marc Elliott, analysts at Investec, wrote in a note to investors. “Glencore may have to undertake further restructuring.”

The slump on Monday was the most since the company’s initial public offering in 2011. The company has been forced to sell new stock and scrap its dividend as part of the $10 billion debt-reduction program as China’s economic slowdown hurt demand for commodities and sent prices slumping. Goldman Sachs Group Inc. said last week that Glencore’s recent steps to reduce debt and bolster its balance sheet are inadequate.

Glencore fell to a record low and was down 28 percent at 70.48 pence by 1:54 p.m. in London. The stock slumped more than 16 percent for the second time in a week and has declined 76 percent this year, the worst performance in the U.K.’s benchmark FTSE 100 Index.

Glencore’s 1.25 billion euros ($1.4 billion) of 1.25 percent bonds maturing March 2021 fell 7 cents on the euro to 74 cents, the lowest since the securities were issued in March, according to data compiled by Bloomberg. The cost of insuring Glencore’s debt against default rose 29 percent to 711 basis points on Monday, according to data provider CMA.

The company counts Qatar Holding LLC, CEO Glasenberg, Harris Associates LP and BlackRock Inc. among its biggest shareholders, according to data compiled by Bloomberg from filings.

The shares have been battered after investors retreated from commodities as China’s economy expands at the slowest pace since 1990. The Bloomberg Commodity Index last month reached the lowest in 16 years and the Bloomberg World Mining Index on Mondaylost as much as 2.5 percent to touch the lowest since 2008.

Glencore has hired Citigroup Inc. and Credit Suisse Group AG to sell a minority stake in its agricultural business, a person familiar with the situation said Friday. The sale is part of the debt-cutting program announced earlier this month that included selling $2.5 billion of new stock in an attempt to reduce the company’s debt to $20 billion from $30 billion.

That might not be enough, according to Investec.

Investec Warning

“The challenging environment for mining companies leads us to the question of how much value will be left for equity holders if commodity prices do not improve,” Investec said in a note. The bank warned that if major commodity prices remain at current levels, almost all of Glencore and Anglo American Plc’s equity value would evaporate in the absence of substantial restructuring.

Anglo American, owner of the world’s biggest platinum and diamond producers, dropped as much as 8.8 percent to a 15-year low in London.

Goldman Sachs said that should commodity prices fall another 5 percent, the metrics needed to maintain Glencore’s credit rating would be out of the required range.

Chinese Market

Billionaire Glasenberg has said no one can read the Chinese commodity market. The nation’s industrial profits dropped 8.8 percent last month, the most in at least four years, signaling weakening demand. The biggest consumer of commodities is struggling with excess capacity, sluggish investment and weaker manufacturing.

Moody’s Investors Service earlier this month cut its outlook to negative on Glencore and affirmed the company’s Baa2 debt rating. Standard & Poor’s has reduced its outlook on Glencore’s BBB level to negative, saying China’s slowing economy will continue to weigh on copper and aluminum prices, which are near six-year lows.

El Niño Could Turn Into Worst Nightmare For U.S Natural Gas Producers ( 10 % less demand this winter)

We have now tumbled into fall, although you wouldn’t know it by looking at the weather forecast. As NOAA’s 8-14 day outlook illustrates, we are set for above-normal conditions for the first week of October across, ooh, basically the entire US. This morning’s natural gas storage report is expected to yield an injection well above the 5-year average of 83 Bcf, and weather forecasts point to further solid injections in the weeks to come.

Last week we took a look at what an El Niño meant for the coming winter as WSI issued its winter weather outlook. WSI is predicting the strongest El Niño in 65 years, which ‘should drive warmer-than-normal temperatures across much of the northern U.S., as the polar jet stream weakens and lifts northward‘. Accordingly, WSI projects natural gas demand this winter to be 10% lower than the previous one.

With this in mind, and with storage levels already 16% higher than last year, and 4% higher than the five-year average, it provides some color as to why the January contract (aka the bleak mid-winter) is currently at a 16-year low.


(Click to enlarge)

There is a somewhat more frosty reception being felt across financial markets today, with Japanese equities opening for the first day this week, and promptly getting walloped. This baton of risk aversion is being passed from continent to continent, as Europe sells off and the US looks down.

Crude prices were finding some solace in a rising euro earlier in the day, with the European Central Bank downplaying the need for further stimulus. But as the outlook gets bleaker for broader markets, risk aversion is dragging crude lower. On the economic data front, we had a weaker-than-expected manufacturing print from Japan (which further greased the wheels for an equity sell-off).

Onto Europe, and German business confidence was the opposite of its compatriot indicator, the ZEW, by showing a weak current assessment but improving expectations (the ZEW was the other way round). Onto the US, and durable goods were relatively in line across the board, while weekly jobless claims came in a little better than expected at 267,000, but slightly higher than last week.

Fears are escalating in the oil patch about an impending credit crunch amid falling investment. Oil producers are set to see credit lines cut by an average of nearly 40%, as the majority of companies see their credit lines shrink due to the revaluation of assets (a twice-yearly phenomenon). This comes at a time when upstream investment is also shrinking in response to lower oil prices. The below chart from EIA highlights that investment levels in the coming years will be significantly lowerthan the 10-year annual average, due to the drop in prices (the crude oil first purchase price is adjusted for inflation).

View gallery


(Click to enlarge)

Finally, we discussed a couple of days ago how Singapore is seeing record stockpiles of fuel oil finding its way onto tankers amid exceptionally strong refining runs. We are seeing a similar tale emerge for diesel exports from China, as refiners keep on refining amid slower demand. According to the General Administration of Customs, diesel exports have risen 77% year-on-year to reach a record 175,000 barrels per day in August. Strong refining runs are endorsed by what we see in our#ClipperData, with Chinese oil imports year-to-date 14% higher than last year, rising to meet this ongoing demand.

Send your portfolio offshore Read http://www.youroffshoremoney.com

GOLDMAN: These Stocks Equal Great Buys

Wynn Resorts

Wynn Resorts

Thomson Reuters

Ticker: WYNN

Sector: Consumer Discretionary

Dispersion Score: 5.6

Upside to Price Target: 89%

Executive Comment: “We enjoy a segment of the market that we wanted to continue to enjoy, the upper premium, the VIP business and the top end of the mass marketing. We enjoy that advantage today and we intended to increase that advantage by the opening of Wynn Palace, such worthy assumptions of its creation, and I’m happy to say that that was the result of the construction and the development,” said CEO Steve Wynn.

UPDATE : Sept 23

Wynn Resorts (WYNN) Stock Falls on Fitch Ratings’ Lower Macau Gaming Revenue Forecast

NEW YORK (TheStreet) — Shares of Wynn Resorts were falling by 3% to $62.01 on Wednesday morning, after Fitch Ratings revised its Macau gaming growth forecast for 2015.

The statistical ratings firm said it now expects Macau gaming revenue to decline between 33% and 34% in 2015, down from its previous forecast of a 29% decline.

Fitch Ratings said that gaming revenues in Macau are down 36.5% year to date through August, which reflects on the difficult first-half 2014 comparison, and pressures such as a corruption crackdown in China that took a toll on gaming.

The ratings firm said that Macau’s decision to loosen its visa restrictions “should produce some positive benefit, underscoring that Macau is willing to use certain levers to prop up its gaming-centric economy.”

Fitch Ratings said it expects Macau gaming growth in 2016 to be “relatively flat,” citing the positive impact of new properties opening in the region next year.

The lower 2015 Macau gaming revenue forecast helped bring down shares of casino operators with properties in the region, including Wynn Resorts.

Separately, TheStreet Ratings team rates WYNN RESORTS LTD as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

“We rate WYNN RESORTS LTD (WYNN) a HOLD. The primary factors that have impacted our rating are mixed — some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. Among the primary strengths of the company is its expanding profit margins over time. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and weak operating cash flow.”

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • 37.14% is the gross profit margin for WYNN RESORTS LTD which we consider to be strong. Regardless of WYNN’s high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 5.42% trails the industry average.
  • WYNN, with its decline in revenue, underperformed when compared the industry average of 4.0%. Since the same quarter one year prior, revenues fell by 26.3%. Weakness in the company’s revenue seems to have hurt the bottom line, decreasing earnings per share.
  • WYNN RESORTS LTD has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Stable earnings per share over the past year indicate the company has managed its earnings and share float. We anticipate this stability to falter in the coming year and, in turn, the company to deliver lower earnings per share than prior full year. During the past fiscal year, WYNN RESORTS LTD’s EPS of $7.17 remained unchanged from the prior years’ EPS of $7.17. For the next year, the market is expecting a contraction of 54.4% in earnings ($3.27 versus $7.17).
  • Despite any intermediate fluctuations, we have only bad news to report on this stock’s performance over the last year: it has tumbled by 60.15%, worse than the S&P 500’s performance. Consistent with the plunge in the stock price, the company’s earnings per share are down 72.00% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • Net operating cash flow has decreased to $201.34 million or 45.41% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm’s growth is significantly lower.
  • You can view the full analysis from the report here: WYNN

Viacom Inc.

Viacom Inc.

REUTERS/Lucas Jackson

Ticker: VIAB

Sector: Consumer Discretionary

Dispersion Score: 3.3

Upside to Price Target: 52%

Executive Comment: “Viacom is seizing every opportunity. Many of our brands speak to the younger audiences that are at the leading edge of the evolution of media. This has always proven to be an advantage over the years and will again as we accelerate our investment in initiatives, platforms and content. We continue to do the hard work to confidently move forward and lead our industry through the latest pivot,” said CEO Philippe Dauman

Dollar Tree Inc.

Dollar Tree Inc.


Ticker: DLTR

Sector: Consumer Discretionary

Dispersion Score: 2.1

Upside to Price Target: 44%

Executive Comment: “Dollar Tree continues to be part of the solution for millions of consumers as they strive to balance their household budget. We serve a very loyal and growing customer base. Our commitment is to continue serving our existing customers better while taking every opportunity to gain new customers in every store every day,” said CEO Bob Sasser.

United Continental Holdings

United Continental Holdings

Getty Images/Scott Olson

Ticker: UAL

Sector: Industrials

Dispersion Score: 3.9

Upside to Price Target: 35%

Executive Comment: “The second quarter was a very good quarter for United and I am proud of the work our employees have done to deliver record earnings which benefit all our constituencies, including our employees themselves. We have a great deal of confidence in our future as we work to make United the carrier of choice,” said CEO Jeff Smisek.

Urban Outfitters

Urban Outfitters

Flickr/Mike Mozart

Ticker: URBN

Sector: Consumer Discretionary

Dispersion Score: 3.5

Upside to Price Target: 34%

Executive Comment: “All brands have carefully, but steadily, offered larger, non-redundant product assortments across a number of categories and, in several cases, have added entirely new categories. At the same time we are launching initiatives to make very important operational improvements, like better category distortion in stores, faster reaction to customer demand, more efficient use of store space, and better integration of technology,” said CEO Richard Hayne.

Portfolio savings : for information on saving taxes by going offshore read http://www.youroffshoremoney.com


Get every new post delivered to your Inbox.

Join 2,325 other followers