NYSE:PBR   PETROLEO BRASILEIRO SA PETROBR
312 8 7
I wish I could go into more detail, but cannot for the sake of conciseness.
PBR             is extremely undervalued. Revenues and FCF have grown significantly since the beginning of operations for the company, yet it is trading as if it's moving into bankruptcy. If they begin to pay down corporate debt, shareholder value will be unlocked.

Market concerns: Brazil has 5-6% inflation and gov't seems to weigh down PBR's potential.
Technicals: Volatility suggests that PBR             is likely nearing a long term bottom. The largest spikes in volatility were in 2003             , 2009, and now in 2014. Also, the falling wedge ( bullish formation) may suggest a break-out to the upside.

Each RELATIVE entry point ended up delivering massive returns. With that said, there will be continued volatility, however $10.27 is a VERY good price in my opinion. I will most likely open a (100k) position in PBR             tomorrow.
LT             PT: $20-$30. Questions? Comment below. Thanks.
RazerMek
2 years ago
Interesting stuff Techtime. I bet you do quite a bit of fundamental leg work and simply post the charts for our amusement. If both VALE and PBR turn out to generate these returns over the next few years....you might as well be my hedge fund manager lol. I like this idea. Thanks again.
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Tech time
2 years ago
I am a professional money manager with many clients and have significantly outperformed the indexes over the years (after fees and taxes).

I'm initiating a position here (3% of my portfolio). I have alot more capital to work with in order to average down. For instance, if the price goes to $9 I can double my position.

Conversely, I wouldn't be surprised if VALE and PBR started moving higher from here. I'm growing my positions, but staying conservative for the sake of volatility (we might see cheaper price levels). And while sentiment is in the dumpster...the market can ignore fundamentals for only so long. Asset allocation is a tricky ordeal because you don't know when the institutional money will move back in.

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Tech time
2 years ago
Don't let the markets control you. Be greed when others are fearful..and they just had headlines about multi-billion dollar managers decreasing their positions when PBR is moving to new lows. What is the thought process there? Sure you may reduce exposure...but it's associated with risk. If something gets cheaper, and you like the company, buy more.

PBR might be at $5 next year, or it could be at $20. But provided they are a multi-billion dollar company with a very strong financial position. It is unlikely they will stay around $10 for an extended period of time. EPS continues to grow, don't let the market fool you (Buffett rarely is).
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topo54
2 years ago
I agree with your chart and commentary. Thank you - good job!
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Tech time topo54
2 years ago
thanks topo54.
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Tech time
2 years ago
up ~30% since my call 2 weeks ago...hope you guys bought some shares.
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piclez
2 years ago
I'm thinking in investing some $$ in PBR but do you think we could see lower prices <$6 like back in 2003 it was around $3 for a while.
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Tech time piclez
2 years ago
I exited a while back and did not re-enter a position. The company is cheap but oil showing continual weakness i'm sitting on the sidelines. We could see shares break into the $5 area fast if this triple bottom breaks. I think it can...speculators are assuming further short term downside for oil.
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