T. Boone is 90 yrs old. He has to sell some. He is still by far the largest shareholder. Nothing wrong in selling a few.
Oil billionaire T. Boone Pickens has been pushing for natural gas as a replacement for oil but late last week he sold nearly $7 million in shares of Clean Energy Fuels in his first open-market transaction of the year.
Clean Energy (ticker: CLNE ) builds and operates compressed natural gas (CNG) and liquefied natural gas (LNG) fueling stations. Pickens co-founded the predecessor company to Clean Energy in 1996.
According to a regulatory filing, Pickens now directly holds 15,961,860 Clean Energy shares, a 14.3% stake based on weighted average diluted shares outstanding as of June 30. He sold 1.5 million shares over Aug. 31, Sept. 1 and 2 for a total of $6.84 million, or $4.55 each. Pickens remains the company’s biggest shareholder.
About a year ago, from Sept. 8 through Sept. 10, Pickens sold nearly 700,000 shares for $3.44 million, or $4.93 each, slightly better than his latest sales. The sales in 2015 and this year are Pickens’s first open-market transactions in Clean Energy since 2012.
Pickens had filed with the Securities and Exchange Commission for the latest sales also a year ago. Clean Energy issued a press release on Sept. 11, 2015, noting that despite his upcoming sale, Pickens was “as bullish as ever on the company’s future and the benefits of natural gas as a transportation fuel.”
But Pickens’s continued calls for higher oil prices -- and wider utilization of natural gas as a vehicle fuel -- haven’t yet panned out.
After second-quarter earnings, Raymond James analyst Pavel Molchanov noted in an Aug. 10 research report that Clean Energy’s loss per share, 6 cents, was half what he had been expecting. Despite the “slow industrywide growth,” Clean Energy is “a risky short” if per-barrel oil prices recover into the $60s by year-end. Molchanov rates the stock at Market Perform.
Apart from CNG and LNG, Clean Energy also offers Redeem, a renewable natural gas (RNG) fuel made entirely from organic waste for commercial vehicles. Redemption is something the company’s investors have been looking for as of late.
Clean Energy went public May 25, 2007, two days after Pickens’s 79th birthday, with shares priced at $12 each. Trading was volatile and at times the stock was well below that of the initial public offering. By late March 2012, Clean Energy touched what now stands as an all-time intraday high of $24.75. Since early May 2015, though, it has been a sub-$10 stock, closing at $4.63 on Tuesday.
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“I’m a believer in global warming,” Pickens declared during a 2012 TED Talk. He stressed that natural gas was cleaner than oil, abundant domestically, and doesn’t need to be refined out of the ground. He also says that natural gas is a “bridge fuel,” a near-term solution to weaning America off oil from Organization of Petroleum Exporting Countries (OPEC) and that a long-term solution could include nuclear power but saw dimmer prospects for solar and wind power.
Pickens said that he’d “lost $150 million” on investing in wind energy -- “that’ll make you abandon something.” Wind energy can’t compete with natural gas when the latter is priced under $6 per thousand cubic feet, he said.
Natural gas itself hasn’t been competitive in the face of cheap oil, and the latest consumption statistics from the Energy Information Administration are less than inspiring to those with money riding on CNG or LNG as a vehicle fuel. There was essentially no growth in natural-gas vehicle fuel consumption in 2014 and 2015. While January 2016 started out 11% higher than December 2015, consumption has been flat to lower through the end of June, the latest month of available data.
Pickens continues to warn of higher oil prices. In March of last year he declared on CNBC that oil was headed to $70 a barrel by year-end. When it was obvious that things weren’t going his way by October, he declared that he’d underestimated how much money OPEC was willing to lose in order to grow market share.
This July Pickens predicted oil will go to $80 a barrel in 2016 and possibly reach $100 in 2017 on his podcast. “We’re already seeing more and more heavy-duty trucks run on CNG. But what about using LNG and other natural-gas fuels for cars, light trucks, and SUVs?” he asked.
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