We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Petrobras Wins Financing Deal From CDB Worth $5 Billion
Read MoreHide Full Article
Brazilian state-run Petróleo Brasileiro S.A. or Petrobras (PBR - Free Report) recently announced that it has signed separate deals with China Development Bank ("CDB") and Unipec Asia Company, a subsidiary of China Petroleum & Chemical Corporation .
The financing agreement with CDB worth $5 billion will mature in 2027. Per the agreement, half of the payment of the financing contract will be made this month while the rest will be paid in January 2018, following the company's payment of $2.8 billion to CDB related to a loan taken in 2009.
The deal is in line with the company's liabilities management strategy. The lone agreement also signifies that the company has emerged from the threat to its credit rating caused by the multibillion-dollar money laundering and bribery case.
In the separate deal with Unipec Asia Company, Petrobras signed a 10-year long contract, which requires it to supply 100,000 barrels of oil equivalent per day (Boe/d). The integrated energy company‘s supply contract with Unipec Asia Company will replace a 2009 contract between the two companies, which was supposed to expire in 2019 and authorized Petrobras to supply 200,000 Boe/d.
About the Company
Headquartered in Rio de Janeiro, Petrobras is the largest integrated energy firm in Brazil and one of the largest in Latin America. The company’s activities include: exploration, exploitation and production of oil from reservoir wells, shale and other rocks, as well as refining, processing, trading and transportation of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities. The company operates in six segments: Exploration and Production (E&P), Refining, Transportation and Marketing, Distribution, Gas and Power, Biofuels and International.
Considering Brazil's huge pre-salt oil reserves – estimated at 9.5 to 14 billion barrels of oil equivalent and widely thought to be the most important oil find in recent years – we believe Petrobras is in an enviable position to maintain an impressive production growth profile for years to come.
However, the company has massive debt loads as it carries a net debt of more than $88 billion, with net debt-to-capitalization ratio approximately 51%. As such, leverage remains a key area of concern for the firm.
In addition, Petrobras has lost 2.5% of its value year to date against 5.7% growth of its industry.
Houston, TX-based ConocoPhillips is a major global exploration and production company. The company’s sales for 2017 are expected to increase 24.4% year over year. The company delivered an average positive earnings surprise of 152.3% in the last four quarters.
Dallas, TX-based Holly Energy is a production pipeline company. The company’s sales for 2017 are expected to increase 10.4% year over year. The company delivered a positive earnings surprise of 57.1% in the third quarter of 2017.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
Petrobras Wins Financing Deal From CDB Worth $5 Billion
Brazilian state-run Petróleo Brasileiro S.A. or Petrobras (PBR - Free Report) recently announced that it has signed separate deals with China Development Bank ("CDB") and Unipec Asia Company, a subsidiary of China Petroleum & Chemical Corporation .
The financing agreement with CDB worth $5 billion will mature in 2027. Per the agreement, half of the payment of the financing contract will be made this month while the rest will be paid in January 2018, following the company's payment of $2.8 billion to CDB related to a loan taken in 2009.
The deal is in line with the company's liabilities management strategy. The lone agreement also signifies that the company has emerged from the threat to its credit rating caused by the multibillion-dollar money laundering and bribery case.
In the separate deal with Unipec Asia Company, Petrobras signed a 10-year long contract, which requires it to supply 100,000 barrels of oil equivalent per day (Boe/d). The integrated energy company‘s supply contract with Unipec Asia Company will replace a 2009 contract between the two companies, which was supposed to expire in 2019 and authorized Petrobras to supply 200,000 Boe/d.
About the Company
Headquartered in Rio de Janeiro, Petrobras is the largest integrated energy firm in Brazil and one of the largest in Latin America. The company’s activities include: exploration, exploitation and production of oil from reservoir wells, shale and other rocks, as well as refining, processing, trading and transportation of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities. The company operates in six segments: Exploration and Production (E&P), Refining, Transportation and Marketing, Distribution, Gas and Power, Biofuels and International.
Considering Brazil's huge pre-salt oil reserves – estimated at 9.5 to 14 billion barrels of oil equivalent and widely thought to be the most important oil find in recent years – we believe Petrobras is in an enviable position to maintain an impressive production growth profile for years to come.
However, the company has massive debt loads as it carries a net debt of more than $88 billion, with net debt-to-capitalization ratio approximately 51%. As such, leverage remains a key area of concern for the firm.
In addition, Petrobras has lost 2.5% of its value year to date against 5.7% growth of its industry.
Zacks Rank and Stocks to Consider
Petrobras has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the oil and energy sector include ConocoPhillips (COP - Free Report) and Holly Energy Partners, L.P. . Both these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Houston, TX-based ConocoPhillips is a major global exploration and production company. The company’s sales for 2017 are expected to increase 24.4% year over year. The company delivered an average positive earnings surprise of 152.3% in the last four quarters.
Dallas, TX-based Holly Energy is a production pipeline company. The company’s sales for 2017 are expected to increase 10.4% year over year. The company delivered a positive earnings surprise of 57.1% in the third quarter of 2017.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>