Yesterday activist investor
reported a large buy into
Talisman Energy (
, as reported by
GuruFocus Real Time Picks
. The always vocal investor picked up a total of 61,554,602 shares
of the company's stock. Icahn announced on Monday via Twitter that
he had built up a nearly 6% stake in Talisman Energy, representing
an approximately $300 million investment.
The tweet featured below reports that bought approximately 61
million shares and that meetings with the company's management
could be in the near future.
According to the SEC report, Icahn began to purchase these shares
on Sept. 25 and since then has built up a 5.97% stake in the
Talisman Energy is a Canadian-based oil and gas producing company.
Its primary businesses are exploration, development, production,
transportation and marketing of crude oil, natural gas and natural
Talisman Energy's historical revenue and net income:
Icahn has had a busy year thus far. The guru lost the fight for
) to the computer company's CEO Michael Dell, and even more
recently Icahn announced his new position in Apple (
) and his pursuit to get CEO Tim Cook to award a $150 billion
buyback. Icahn has also seen great success in Netflix and has
become one of the largest shareholders of Herbalife.
According to Forbes, Icahn has bought into a company with a market
cap "under $15 billion, with falling revenues and earnings, and a
decently sized $5.2 billion debt load."
The company has been struggling as of late and could use Icahn's
influence and direction. President and CEO Hal Kvisle has made
several noble attempts at financially restructuring the company,
but so far they have not really made any noticeable positive impact
towards the company.
So far in his attempts, Kvisle has sold down Talisman's interests
in oil and gas plays in Canada as well as in the North Sea. This
generated $3 billion which then went to help the company's capital
spending habit, and has ultimately outstripped the company's free
cash flow from operations. Kvisle has also attempted to spend more
carefully by focusing on projects with faster cycle times.
Christopher Helman of Forbes reports that the problem with his
strategies thus far is that "turning a big company around takes
time, but investors are impatient," and they get even more
impatient when the company's earnings are not up to par.
The CEO told the Globe & Mail: "I have two objectives here: One
is to revamp the company, to reset the strategy, to adjust the cost
structure, to get everything going in the right direction. The
second objective I have is to assist in getting a new CEO in place.
Then I'm out."
The analysis on Talisman reports that the company's revenue has
been in decline, its dividend yield is at a one-year low, it's had
an operating loss over the past three years and its P/E ratio is at
a 10-year high.
Talisman Energy has a market cap of $12.7 billion. Its shares are
currently trading at around $12.27 with a P/E ratio of 95.30, a P/S
ratio of 2.00 and a P/B ratio of 1.30. The company's dividend yield
is currently at 2.20%. Talisman had an annual average earnings
growth of 0.8% over the past ten years.
Check out all of Carl Icahn's real time picks here.
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