NPF Stock Portfolio - March -2.54% Quarter 1 -1.01% Trailing 12 Months +6.21% Dividend Yield Average Q1 +2.01%

Below is a list of stocks that meet strict preliminary criteria using NFP's stock strategy. Each company will be thoroughly researched for potential purchase. Not all companies or sectors will be purchased. Do your own research every time for every company. Sometimes you may see stocks that are already part of the NPF portfolio. In that case, we most likely will be using collected dividends to buy more shares at what we believe is a discount price.  

WHO?

Permian Resources Corporation NYSE: PR

WHAT?

Permian Resources Corp. engages in the exploration and production of oil and natural gas. It also focuses on driving sustainable returns through the responsible acquisition, optimization, and development of crude oil. The company was founded on October 6, 2014 and is headquartered in Midland, TX.

WHEN?

Initial purchase was made on Tuesday, September 9th 2024 @ $13.00 per share.

WHY?

After Exxon (XOM) purchased our last venture into the oil business, Pioneer Natural Resources Company, we came away with a nice windfall but really wanted to find a company that was very similar to fill the hole left in our portfolio. It takes us a long time to find something we all can agree on, luckily we ran into PR. PR is also an independent oil and gas exploration and production company that works out of Texas and the Permian Basin. 

Seeing that it has only been 4 years since we owned PXD, the same thesis on oil and natural gas remains the same. Green energy is at least 20 years away from being actually viable and as world wide reserves of crude and natural gas shrink, the value will rise. The world will always need plastics, cosmetics, medical PPE, rubber and 2000+ other products produced by crude. 

PR has a PE of 11, a dividend yield of about 6% and an internal 1 year price target of $20.00 at the time of purchase, we think it is the right fit. 

update!!!

In May 2024 Pioneer Natural Resources (PXD) was purchased by Exxon Mobil (XOM) in a all stock deal. NPF received 2.3234 shares of XOM for every share of PXD. NPF fully liquidated the position on Thursday, June 6th 2024 @ $114.00.

WHO?

Pioneer Natural Resources Company NYSE: PXD

WHAT?

Pioneer Natural Resources Co. operates as an independent oil and gas exploration and production company. The firm engages in hydrocarbon exploration in the Cline Shale. It focuses on the operation of the Permian Basin, Eagle Ford Shale, Rockies, and West Panhandle projects. The company was founded by Scott Douglas Sheffield on April 2, 1997, and is headquartered in Irving, TX.

WHEN?

Initial purchase was made on Thursday, March 19th 2020 @ $60.00 per share.

WHY?

At the time, the portfolio was lacking some additional energy exposure. This business had been on the NPF watchlist since October 2019. It was a unique time with unique opportunities. The business was underrated and undervalued. Despite what mainstream media may like to believe, crude oil, shale, natural gas, and all other fossil fuels are not going anywhere. In reality, green energy is at least 20+ years away from being actually viable in any meaningful way. What is meant by that is useful to non-Western countries.

The price of this stock fell all the way down to 2011 levels. However, it never stopped paying a decent dividend (around 7.00% at the time of purchase). The company was sound, with a low PE ratio of 10, EPS around 24, a profit margin around 28%, and a 99% Dividend Payout Ratio. The time was right for the stock.

WHO?

Honeywell International INC. NASDAQ: HON

WHAT?

Honeywell International, Inc. is a software industrial company, which offers industry specific solutions to aerospace and automotive products and services. It operates through the following segments: Aerospace, Honeywell Building Technologies, Performance Materials and Technologies, Safety and Productivity Solutions, and Corporate and All Other. The company was founded by Albert M. Butz in 1906 and is headquartered in Charlotte, NC.

WHEN?

Initial purchase was made on Friday, February 5th, 2010 @ $35.00 per share.

Sale of all shares complete on Friday, September 27th, 2024 @ $210.00 per share

WHY?

Although Honeywell rose over 530% since our initial purchase, the last 14 quarters have been range bound. Total returns without dividends is -15% over 14 quarters. Despite the ever growing dividend we felt as though the capital held by this business may be better deployed later. Revenue has been just around $9 billion with no significant change in the past 7 quarters. 

We still believe that Honeywell is a great company, however we have not seen any real growth in revenue, profits or breakout innovation in 3 and half years so we believe it is time to move on for now. 

WHO?

Dollar Tree NASDAQ: DLTR

WHAT?

Dollar Tree, Inc. owns and operates discount variety stores offering merchandise at fixed prices. It operates through the Dollar Tree and Family Dollar segments. The Dollar Tree segment includes operations under Dollar Tree and Dollar Tree Canada brands, with its distribution centers in the United States and Canada. The Family Dollar segment consists of a chain of general merchandise retail discount stores providing consumers with a selection of competitively priced merchandise in convenient neighborhood stores. The company was founded by J. Douglas Perry and Macon F. Brock, Jr. in 1953 and is headquartered in Chesapeake, VA.

WHEN?

Initial purchase was made on Monday, April 13th 2013 @ $47.75 per share.

Sale of all shares complete on Monday, December 12th 2022 @ $143.50 per share

WHY?

The stock was a remnant of non-dividend-paying stocks that had been sold off one by one to make room for other dividend-paying stocks and bulk up cash reserves. Beyond that, there were three major concerns during the last few years of ownership. The most glaring was an increase in price of 25% for most products. That stemmed from political issues with China and the constant pressure of supply chain and inflation.

Next, the website and user experience were old and outdated. Not being able to order any product on the site to any store was and continues to be a major issue. Customers sometimes were not able to order certain products to their local store or directly to themselves.

Third was profits. These kinds of businesses have razor-thin margins as it is. DLTR's debt load was growing, but sales were not. From 2018 to 2021, it was basically flat. The pandemic boost was nice, but it wasn't real. Yes, the share price climbed 75% between October '21 and July '22. Then reality struck.

With even more supply chain issues coming up, major inflation markers on the horizon, thin margins, and no dividends, the writing was on the wall for shares in this company.