Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, South American oil giant Petroleo Brasileiro (NYSE: PBR ) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Petrobras' business and see what CAPS investors are saying about the stock right now.
Petrobras facts
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Headquarters (founded)
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Rio de Janeiro (1953)
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Market Cap
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$252 billion
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Industry
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Integrated oil and gas
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Trailing-12-Month Revenue
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$128.52 billion
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Management
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CEO Jose de Azevedo (since 2005)
CFO Almir Barbassa (since 2005)
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Return on Equity (average, past 3 years)
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20.1%
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Cash/Debt
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$33.95 billion / $71.06 billion
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Competitors
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BP (NYSE: BP )
Chevron (NYSE: CVX )
ExxonMobil (NYSE: XOM )
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 98% of the 4,243 members who have rated Petrobras believe the stock will outperform the S&P 500 going forward. These bulls include sssandhu78 and mitleg.
Two months ago, sssandhu78 wrote that Petrobras' upside seemed worth the risks:
Aggressive expansion, big reserves. What I don't like is all the big spending downstream and also the excessive role of the government in the company. But overall I would take the chance.
Petrobras even boasts a robust three-year average operating margin of 23.1%. That's higher than that of other integrated oil giants such as BP (4.5%), Chevron (12.1%), and Exxon (12.7%).
CAPS member mitleg elaborates on the bull case:
On the one hand it has huge reserves. Oil prices have been creeping up, and oil seems to be a good way to bet on the recovery that is slowly gaining steam. On the other hand the role of the Brazilian government is troubling. PBR has, until the last few months, been a solid underperformer. Given that its offering seems to be behind it, and oil prices are poised to move above $100 per barrel, I think it can outperform.
What do you think about Petrobras, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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