Is Petrobras Worth A Dime?

From Forbes

By Kenneth Rapoza

There aren’t too many publicly traded oil and gas companies in energy-rich Latin America. Petrobras (PBR) of Brazil is one of them, and a long term holders favorite.  It is a key component of the Brazilian iBovespa index, which means anyone holding a Brazil mutual fund or the iShares MSCI Brazil (EWZ) exchange traded fund has their hands in Brazilian oil.

It’s not the greatest place to be.

Year-to-date, the wheels have completely come off Petrobras.  If its stock can be imagined as a deep sea oil drilling platform, it would have a blown-out plantoon and listing into the sea. Shares of Petrobras have not been correlated with oil for years. And now it is pulling away from another Latin America oil fave, Colombia’s EcoPetrol (EC).

“We like EcoPetrol. And we like Colombia. We still own Petrobras, but maybe a hundred thousand shares and not building on it. Petrobras has been very disappointing,” says Heiner Skaliks, fund manager at the Strategic Latin America (SLATX) fund. Over the last 12 months, Petrobras has vastly underperformed oil futures and EcoPetrol.

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