Oil prices were on the move today as the market overlooked the threat of Cyprus to Europe. At 4 p.m. on Tuesday, Brent crude was up 0.12% to $107.61 and WTI crude was up 1.51% to $93.84. U.S. natural gas was up 0.03% to $3.94.
Today's top 3 energy stocks
Among companies with market caps greater than $1 billion, today's energy stocks leader was Walter Energy (WLTGQ), which was up 3.51% to $29.45. Walter Energy is a pure-play metallurgical coal producer with mines around the U.S. and Canada.
Today, Walter Energy announced a $350 million private placement of debt due 2021, $250 million of which will go toward paying down debt. Walter Energy and other coal producers have been hit hard the past two years as low natural gas prices caused natural gas to steal market share from coal among utility companies. The company's stock has also been beaten down as investors fret over a high $2.4 billion debt load.
This past year, the company has faced criticism and a proxy challenge from Audley Capital, which is looking to replace five members of Walter Energy's board at the company's annual meeting next month. On March 11, the current board laid out its case in a letter to shareholders and said they are "intensely focused on maximizing the value of your investment in the Company." Audley Capital begs to differ and hopes investors give their nominees fair consideration.
Second among energy stocks today was Ferrellgas Partners L.P. (FGP) up 2.93% to $20.05 on no real news. Ferrellgas Partners is a master limited partnership (MLP) focused on the distribution of propane. It is the second-largest distributor of propane in the U.S. with a 9% market share, behind AmeriGas Partners (APU), who holds a 15% market share. Ferrellgas, though, is the largest distributor of portable propane tanks, operating under the Ferrellgas and Blue Rhino brands. Ferrellgas has largely grown through acquisitions in the heavily decentralized propane distribution business and the company believes there is plenty more opportunity for acquisitions in the future with 68% of the market independent retailers.
Third among energy stocks today was BP (BP -0.38%), up 2.71% to $42.00. Yesterday the oil and gas giant completed the previously announced sale of its stake in TNK-BP to Russian firm Rosneft in exchange for 18.5% of Rosneft and $4.5 billion in cash. Today, the company announced it would buy back $8 billion worth of shares, roughly the same amount it spent forming TNK-BP.
BP CEO Bob Dudley said, “BP is moving on to the next phase of its business in Russia, becoming the largest private shareholder in Rosneft, Russia’s leading oil company. In the process we have also released cash, equivalent to at least six years of BP’s anticipated future dividends from TNK-BP. We look forward now to working closely with Rosneft and together developing opportunities to create value for both companies.”
