Tell me why I shouldn't invest in Petrobras.

- Highly correlated to oil price (WTI currently $83.26).
- Pays an extremely handsome dividend (60% yield) although I've seen this number change on a few sources.
- Has paid roughly between $0.50 - $1.2 dollars per share since the '21 oil price recovery each quarter.
- Chart looks like it has room to run with a near term support of around $9.5 (so ~$2 risk at current levels).

ea1060 said:

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La Bamba said:

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Tell me why I shouldn't invest in Petrobras.

- Highly correlated to oil price (WTI currently $83.26).
- Pays an extremely handsome dividend (60% yield) although I've seen this number change on a few sources.
- Has paid roughly between $0.50 - $1.2 dollars per share since the '21 oil price recovery each quarter.
- Chart looks like it has room to run with a near term support of around $9.5 (so ~$2 risk at current levels).

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Because they're owned by the corrupt Brazilian government who couldn't manage a grocery store lol. Anytime a dividend is that high, there's typically a bad reason why.

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Very fair point, Matter of fact I'm not even sure if the brazilians know who their president is (Lula or that Bolsonaro guy) but I wonder.... the company did rake in $30 bln in profits in 2022 despite all this crazy political stuff going on. Makes me think they can manage it as long as the oil price stays up?

Dividend isn't sustainable, so it'll have to come down.

And it bleeds equity. Something that many folks don't realize about high dividends is that the stock price drops by the amount of the dividend on ex-Div date in order to prevent arbitrage (and because quite literally, if they're dumping that much cash, that means they're worth that much less as a company in that moment).

In terms of total market returns (equity + dividends), XOM did better in 2022 than PBR, according to portfoliovisualizer.com. 87.36% returns vs 55.49% - and that's before PBR slash their dividend (which they'll eventually have to, according to their sustainability ratio).

Way better off to stick with US brand names here.

I own PBR and when it goes down I buy more.
Brazil is protection from the devaluation of American currency and the USA Woke agenda on fossil fuel.
Political corruption is not an evaluation - Joe Biden is totally corrupt should I sell Apple?
If you want income you cannot beat PBR, buy it below 11.50, the stock functions like a MLP.

BTW XOM just left Brazil at least in Brazil they take care of Brazil business, PBR got the better leases.

Nothing like cashing that check and heading over to Casa De Brazil.

TrailerTrash said:

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I own PBR and when it goes down I buy more.
Brazil is protection from the devaluation of American currency and the USA Woke agenda on fossil fuel.
Political corruption is not an evaluation - Joe Biden is totally corrupt should I sell Apple?
If you want income you cannot beat PBR, buy it below 11.50, the stock functions like a MLP.

BTW XOM just left Brazil at least in Brazil they take care of Brazil business, PBR got the better leases.

Nothing like cashing that check and heading over to Casa De Brazil.

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please be a troll