#16

Wednesday, March 2, 2022

**NOTHING HERE SHOULD BE CONSIDERED INVESTMENT ADVICE.**

Chevron, the stout oil and gas juggernaut rang the bell yesterday morning at the New York Stock Exchange (NYSE) to celebrate being listed on the NYSE for over 100 years. Chevron seems to have a solid foundation and is managed well. Here are reasons I believe that:

• Even after 142 years of existence, the company is still relevant and delivering value to the world. Not an easy feat for a company that old.
• They have a healthy quarterly dividend at $1.42 (a recent 6% increase)
• They expect to distribute 50% more cash to shareholders this year vs last year
• Announced increasing their share buyback form $5B to $10B
• Expects 12% return on capital & operating cash flow to grow 10% per year through 2060….at $60/barrel Brent pricing. (….the question then becomes are you comfortable with the $60/barrel for this timeframe?)
• If Brent oil stays at $75 over next 5 years, they have plan to repurchase 25% of the company (share buyback)…..this is significant.

Assuming some key assumptions, the above paints a rather rosy picture. Will any of it pan out? Not sure, but it may be worth your time to dig in a little deeper. Luckily yesterday was Chevron Investor Day should you want to.

Over the last several years, you’ve likely heard all about Russia’s propaganda machine. In addition to their misinformation tactics online and throughout social media, they also take a more traditional news media route for spreading false narratives. Russian state-backed outlet RT had plenty of reasons to be concerned when the European Commission President promised to “ban the Kremlin’s media machine in the EU.” It seems like others are catching on (…and rightfully so). Here are some noteworthy companies given recent announcements….

• YouTube, TikTok, and Meta have blocked RT in Europe, making RT inaccessible across the continent.
• Meta and Google cutting off RT’s ability to monetize through their platforms (…basically cutting them off from ads).
• Roku is barring RT in Europe from its streaming service.
• TV providers globally are dropping RT, including Canada’s Rogers Communications and Bell Canada.
• Surprisingly, in the US both DirecTV and DISH still provide access via RT America. I haven’t seen any real relevant statements made or released from either company other than the general “…..thoughts are with Ukraine…”, etc.. Not too surprising given these two companies haven’t been relevant in many years now.

In addition to these companies cutting ties with RT, several of the company’s key employees have taken to Twitter to publicly quit.

All these are significant moves which will make it much harder for the Kremlin to communicate the narrative(s) of their choosing. Something I’m sure they’d love better control of now as their standing in the world continues to fall.

Mayday mayday…..we have a problem. Sad update to report on the cargo ship that was filled with all our Porsche’s, Bentley’s and Lamborghinis. (tasty story dished up on BW #9 HERE). The freight cargo ship originally carrying at least 4,000 cars and over $400M worth of cars has finally sunk off the Azore Islands of Portugal. The fire was apparently caused by lithium-ion batteries in the electric vehicles and ended up burning for a few days. Now the focus of the Portuguese Navy has shifted to stand by and look for signs of pollution that these vehicles could cause.

And as much as that sucks for the Volkswagen group and all of their associated dealers and customers waiting on those vehicles…..it potentially could’ve been worse. You could’ve owned a large piece of Russia’s national gas company Gazprom or state-owned bank Sberbank. Given increasing sanctions being put in place by Western nations, and prominent sponsors/partners now dropping off, both saw a single day drop in their stock price of 97% and 94% respectively. Now....let that sink in for a second. (...see what I did there?)

I imagine right about now Beavis and Butthead would be saying……“uhhhh, that’s gotta suck!” 🤘

Deuces. ✌️