Why YPF is among safest stocks (energy or otherwise)
I stated before that YPF was a mugging victim when in fact Repsol was the unfortunate loser.
I like YPF (even though revs & earns have been somewhat flat the past 7 years.)
Definitely wouldn't bet the farm though (don't let analyst price targets dazzle you...)
I bet the farm - but have't read 1 analyst report (no faith in them).
Btw, I do not want to invest in a co I know does things unethically, and from what I can tell (and even after speaking to an Energy 'researcher' who generally doesn't trust Argentina) it's a tough to call. They made the case oil imports should have never climbed so dramatically if Repsol were meeting their contract demands. But - I'm not intimate with the contract, nor Repsol's ethical actions.
I do like the social aspect of a country using revenues to help support their people, similar to PBR - Petrobras.
I'm well aware of what happened with Repsol & why (partially...)
Argentina wants energy independence & capped exports at $42/bbl with the rest going to the government in order to encourage companies to not export what they produce from Argentine leases (was Repsol skirting this?)
They also want to exploit their shale deposits & the YPF board was loath to reduce the high div payout to free up capital (granted the cash freed up by this move will not be enough to accomplish this goal without partners.)
They definitely shot themselves in the foot on that front (kind of hard to develop trust with any future partners as the recent road show in USA demonstrated.)
Someone; however, will sign a deal under terms which are extremely favorable for them (Chevron maybe?)
Personally I think they'll kiss & make up with Repsol or at the very least work out some kind of settlement.
I'll take my chances with my tiny position in YPF (ethical or not...)
As an aside; the Argentine government also decided not to auction 3G & instead kept it for state run telecom which further shows their commitment to interference in free trade.
As to PBR; they get blackmailed by the government (a 50%+ shareholder) into spending on community projects even though they'd be doing it anyway as the most visible company in the country.
Look to Vale for a nice 10 year hold...
By the way; I run an anchor handling tug/supply vessel in Brasil & have worked with Petrobras extensively & wouldn't even consider investing in such a disorganized bunch!
(It's amazing they even manage to get a single drop of oil to market.)
I also worked in Venezuela back in the mid 90's but was long gone by the time HC took over.
Argentina & Venezuela may resemble each other a bit but they are 2 very different countries.
Venezuela is a hole & Argentina is absolutely gorgeous!
How about a list of some of your ethical buy/hold positions?