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Cash In as This Rural Telephone Company Outsmarts the Sector Giants

As the longtime subscribers among you folks know, we love spin-offs here at Private Briefing.

These corporate breakups are a way to make market-beating returns – and at below-market risk.

It’s that penchant for spin-offs that prompted our pre-breakup recommendation of Abbott Laboratories Inc. (NYSE: ABT) back in June 2012.

  • Featured Story

    What's Really reducing Carbon Emissions in America? (Hint: It's Not Obama)

    Soap isolated

    President Obama this week declared war on coal when he announced that he'll sidestep Congress and address the "manufactured" climate change crisis through regulatory fiat. He wants to establish himself as the eco-warrior to appease his left-wing environmental base.

    His global warming crusade will cost the U.S. thousands of jobs and impose higher electricity bills across the land. All in the name of pandering to junk climate science.

    Obama also sent the decision to build the Keystone Pipeline back to the State Department for yet another round of assessments. He ordered State Department not to approve the pipeline, which transmits Canadian Oil Sands to U.S. refineries, if it adds to net carbon emissions.

    While the President is currently writing new rules that will make it harder for existing coal-fired power plants to operate, adding significant costs and effectively destroying tens of thousands of jobs in the coal sector and its supply chains, these plans are being sold as effective government action to address rising carbon emissions in the United States.

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  • Green Energy

  • New Arab Spring Could Breed Chaos in the Energy Markets As Dr. Kent Moors explains, growing unrest means Pakistan is now ground zero when it comes to energy markets in the Middle East. Read more... Read More...
  • Russia: The Greatest Threat to the Energy Markets There's an old saying, "The more things change, the more they stay the same."
    And modern Russia a perfect example of this saying. And this move to the past autocratic methods is creating a very unstable future for the energy markets.
    Dr. Moors explains the warning signs in Moscow that are making energy traders start to worry.
    To find out what's happening and what it means to you, read on...
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  • Three Hidden Water Costs That Promise to Boost Energy Prices On average it takes 4.4 million gallons of water to “frack” a well. As Dr. Kent Moors explains, that has big consequences for energy prices. Read more... Read More...
  • The Next Big Change in the Energy Markets The energy market is rapidly changing. Dr. Kent Moors explains how to hedge your oil and gas stocks with this simple "insurance policy." Read more... Read More...
  • How to Play by the Rules and Beat the Tax Man with MLPs Paying taxes is about a pleasurable as a root canal. But as Dr. Kent Moors explains, you can ease the pain by investing in Master Limited Partnerships, or MLPs. Here's how. Read More...
  • This Shifting Balance Will Have a Huge Impact on Energy Investors As the new balance emerges, we will see a realignment of global energy prices. And both the sourcing and use of energy will open up significant opportunities worldwide. Here's what's causing the shift. Read More...
  • Why I Cancelled Everything in Germany and Took the Next Flight to Dubai Something big unfolded on my trip to Frankfurt last week.
    It began with meetings in Germany over natural gas prices. They morphed into a discussion on how government subsidies affect energy prices. Our conversation turned to a recent IMF report that criticized taxes on energy - specifically pre-tax concessions - those provided by governments to producers in oil exporting countries.
    That led four of us to drop everything in Germany and fly to Dubai, so we could hash out the matter firsthand with some of the folks responsible for those tax benefits.
    What we learned there could change everything in the global energy markets and have huge consequences for energy investors around the world.
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  • Investing in Clean Energy Stocks Just Got More Risky

    Despite its promising future, clean energy stocks have proved to be an investing minefield.

    Even China-based clean energy stocks are no longer a safe haven. Yesterday (Monday) Suntech Power Holdings Co. Ltd. (NYSE ADR: STP) defaulted on its debt.

    Heavy losses caused by plummeting prices for solar panels - which fell 73% from 2010 to 2012 - left Suntech unable to make the payment on a $541 million bond that was due Friday.

    The news caused Suntech stock, already down 80% over the past year, to slip another 10%.

    While numerous U.S. renewable energy companies have faltered, most notably the 2011 bankruptcy of solar panel maker Solyndra, Suntech is the first Chinese clean energy company that could go under.

    What's new is a reluctance on the part of the Chinese government to keep pouring subsidies into money-losing companies.

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  • Watch What Carl Icahn Does to These Energy Stocks Light bulb

    Energy stocks have been largely left behind in the recent stock market rally - except for those with interest from activist investors like Carl Icahn.  

    You see, concerns about global demand as well as political pressure to focus on alternative energy have weighed on energy stocks. So have the low price and oversupply conditions in the natural gas markets.

    Many of these energy stocks trade at what seem to be very low prices compared with the assets owned by the corporations and their future prospects.

    This has attracted the attention of many activist investors looking to force the share price to unlock the real value of the underlying corporation.

    One of the best-known activist investors, Carl Icahn, has accumulated several positions in leading energy companies in the past year because of low prices and under-valuations.

    Take, for example, what Icahn's done with CVR Energy Inc. (NYSE: CVI).

    Icahn owns 83% of CVR, a refiner that has seen its stock price soar recently as refining margins have improved. The company also has a fertilizer business that is a major beneficiary of lower natural gas prices.

    The stock has better than doubled in the past year so it would be foolish for investors to chase the shares now.

    But CVR does serve as an example of the sizable returns Icahn is looking to achieve in his foray into additional energy investments, like the following two stocks he's been accumulating.

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  • Why Oil Refiners Are Among the Best Energy Stocks to Buy Now Energy oil refinery 3 small

    Shale oil production continues its upward path, increasing overall U.S. oil production and making specific groups of energy stocks among the best to buy right now.

    In fact, the U.S. Energy Information Agency (EIA) reported last month that domestic oil production surpassed the 7 million barrel a day level, the highest point in nearly 20 years. Production this year, the EIA says, will rise by another 14%.

    This is obviously good news for the companies producing that oil, and it gets even better. Many industries outside the energy sector, including chemicals and railroads, have benefited from the shale boom.

    But there is one subsector in the energy industry that has reaped the rewards of plentiful oil from the Bakken and other areas more than any other, and that's the refining industry.

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  • The Next (Energy) Revolution Starts Here There are few times in life when you stand on at the beginning of a truly revolutionary change. This is one of those moments. Here's what's driving it. Read More...
  • Three Reasons Why the Energy "Experts" are Wrong Last week, we got another batch of oversimplificated "reasons" to explain a significant decline in energy stocks. Excuses ranged from declining demand to shale oil and gas gluts to a general market Armageddon. Now here's the truth. Read More...
  • Four Timely Moves For The Next Three Crises

    Sorry to say, but we are only in a brief "lull" between crises. Nothing was resolved in the eleventh (and a half) hour Fiscal Cliff compromise, and three new crises are coming down the line in 2013. Here's what we face now and how you can still structure your energy portfolio for profits.

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  • The Next Big Boom in Energy Isn't What You Think As the ongoing debate between renewables and fossil fuels continues, there is a wrong-headed presumption that there will only be one clear victor.

    But recent trends in the wind and solar age tell us that this conclusion just isn't so.

    The truth is both types of energy will be required to work in tandem in order to achieve our energy goals in the future.

    And - as these developments accelerate - it is in this "new" energy balance that individual investors will find the next big boom.

    These days, with oil-rich countries like Saudi Arabia and the United Arab Emirates unveiling huge renewable energy projects, even some analysts are drawing the wrong conclusions.

    But I have to stress, renewable development is not a signal these countries are running out of crude oil anytime soon.

    Quite the contrary, countries like Saudi Arabia realize that one side of this energy equation will require the help of the other.

    The same holds true in North America, where the surplus of unconventional natural gas has led some to the erroneous conclusion that wind and solar - still requiring significant government subsidies - have been dealt a fatal blow.

    Wrong again. This is not a winner-take-all battle. There will be no silver bullet that delivers the next "new age of energy"

    Rather, it will be in the integration of all the available energy sources that will lead to the next big development. And that is going to require sourcing from genuinely distinct and dissimilar energy categories-including wind and solar.

    In fact, three recent events provide clear indications that this "energy integration boom" is already well underway.

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  • The Path to Energy Independence is More Rocky Than It Seems You might have seen yesterday's headline in the Wall Street Journal: "U.S. Redraws World Oil Map."

    As the article explains, U.S. oil production is now on pace to surpass Saudi Arabia by 2020. This would make the United States world's largest oil producer. We're already the second-largest natural gas producer, according to 2010 EIA estimates.

    It's all thanks to the U.S. shale boom that has unlocked billions of barrels of oil and trillions of feet of natural gas from the Appalachian Mountains to the Pacific Coast, from the Bakken in North Dakota to the shale fields of southern Texas.

    But all of this fracking has caused some serious economic and environmental problems.

    And while I greatly advocate increased drilling and domestic production, we still must address a wide-range of problems now plaguing the shale oil and gas sectors.

    After all - with apologies to Voltaire and Spiderman - with such great fortune comes greater responsibility.

    That's why I am in the third day of what has become a very interesting conference here in Pittsburgh. It was convened to set the agenda moving forward to deal with the almost invisible aspects of shale oil and gas drilling.

    In fact, for the first time, the conference's primary focus will be on the negatives caused by the drilling.

    We also have questions surrounding the amount of water required to frack these formations (the process needs a lot of water to break open rock and release hydrocarbons), as well as the ongoing public health fears from the chemicals used.

    Now, we are seeing parallel economic problems as well.

    In the Marcellus basin, researchers are now recording some of these shortcomings and placing them in four basic categories.

    The real concern is that these four problems - in infrastructure, labor, local inflation, and the environment - will remain well after the drilling (and the revenue) has moved on.

    So before you decide to declare "energy independence", take a look at some of the downside that may come along with it.

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