Today, the Financial Times notes that PetroChina’s stock performance is lagging, causing it to lose it’s leadership status as the world’s largest oil company:
Is PetroChina more supernova than supermajor? Shares in the company have burned out since exploding late last year. Its spell as the world’s biggest oil company by market capitalisation was a brief one; last week it slipped back behind ExxonMobil. Its premium on a historical price/earnings basis to the biggest international majors has plummeted from a peak of more than 100 per cent to less than 10 per cent.
Is the company a tool of the Chinese government or is it committed to creating shareholder value? Undoubtedly, Warren Buffett asked himself that very question when he bailed out of the company late last year. Perhaps the company and its puppet masters in Beijing might want to think creatively on this question.
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