downthehatch
7 months ago
Crack spread for jet fuel remains inn a range of $25-38. For perspective, that is not as high as the historic highs in 2022, but considerable better than the spread during the Q2 2023 period, when the spread was in the $15-20 range.
https://www.iata.org/en/publications/economics/fuel-monitor/
In the Q3, when the spread rebounded to the $30-40 range, BDCO actually had higher earnings than the Q2 2022, when the spread was even higher, in the $35-45 range. So the company is becoming more profitable, even at a slightly lower spread.
I suspect part of the reason is they are slowly but surely reducing the debt load. I'm looking forward to a positive report for this quarter, and for the year, with earnings somewhere around .40- .45/ share for the quarter. That would make for a second year of annual earning of about $2/share.
At $2/share in earnings, we are trading at a PE of just over 2. Still very cheap.
downthehatch
7 months ago
I've decided to wait and post my prediction of BDCO earnings for the quarter after the company posts actual earnings. Much easier to make an accurate prediction at that point.
I will say this, at $4/share and below, I've been buying more shares. Even at just .50/quarter in earnings, the PE here is 2.
I think we will have some quarters at around $.50 earnings, and others higher.
Oil companies, as reported this morning on CNBC, are severely oversold and BDCO is oversold as well.
downthehatch
8 months ago
Not a problem.... I had missed that, as I was working the election here on Nov 7, and was exhausted on the 8th!
The 8K is an announcement relating to a contract with a BDCO subsidiary dating to 2019 for oil storage at the Nixon storage and terminaling facility originally with Pilot Travel Centers, assigned later to Tartan Oil Co. According to the 8K, Tartan provided 60-day notice that it was canceling the storage agreement as of Dec 31, 2023.
As far as I can tell oil storage and terminaling is a pretty small piece of BDCO's revenue, so this should not have much effect on revenues or earnings.