Northernhick, I've wondered about that too (low price being good for GS). I'd say any NTI unitholder who takes the all-cash payout option in the merger is getting cheated, if the price of WNR is super-low (which it is now IMO). So I suppose it's possible there's some driving down of the WNR price to get NTI at a cheaper price going on, but I tend to think most of the problem is the #$%$ refining margins for all refiners in Q4 2015 and Q1 of 2016.
Hi govpur, are your points 1 - 4 talked about in the conference call, i have only a very small long position in WNR and have been busy to I haven't listened to it yet. Or maybe you got your points 1 - 4 from sources other than the conference call, or maybe the quarterly earnings report? Anyway, please let us know where the facts you mention are coming from if you would... Thanks!
What matters to the refiners pmoutzz is the 'crack spread', the difference between the price of oil and what gasoline is selling at. The whole refinery sector is getting hit the last 6 months because the spread is below the normal level, and so their profit margins are getting squeezed. Personally, I wish they'd do a little informal collaboration to demand a higher margin, but of course that would probably be illegal..
I believe the spread has widened somewhat the last month or so, but it needs to be higher to have margins and therefore profits rebound. Hopefully, there will be strong demand for gas this summer, as maybe people take advantage of low gas prices to take those cross-country trips/vacations they've put off in previous years, we'll see if margins continue to improve into the summer..
On salaries, well, I personally believe CEO's of most US companies are grossly overpaid, and yes they all seem to make more every year, no matter how badly the business does, which I hate too.
But I don't think that has anything to do with WNR specifically, IMO it's more of just an across the board thing that seems to permeate the US corporate management scene in general.
I believe I read in 1960, the average CEO made on average about 50- 75 times what the lowest paid worker for the company made. Today the average CEO probably makes 500-1000 times more than the lowest paid worker!
But is management really 10 or more times effective than a CEO from 1960? I don't think so! In fact, I'd probably guess the average 1960 CEO probably was better than today's..
hzhan1, the refinery stocks in general have been hit hard recently, not just WNR.
If you look at the 'interactive price' chart on yahoo for VLO, or TSO or WNR, they all show a 7.5% to 8.25% price drop if you choose the 1 month time window.
As to why the refiners have been hit, I'm not sure, but I know that VLO was given at least one 'downgrade' recently, maybe there were others as well.
In my experience, analysts tend to give downgrades AFTER price has been crushed, and then give upgrades about the time that price is getting overbought and perhaps is close to peaking-out, so it sort of amazes me that downgrades/upgrades move stock prices as much as they do.
But the fact is that for whatever reason, those upgrades/downgrades do seem to move stock prices, at least for a short while after they are issued.